Thoughts and Opinions On Today's Important Issues

Friday, May 23, 2008

Blameless In Windsor


Can the border file become even more of a mess than it is now. One day someone will sit down and write the history of the last five or six years in Windsor but the problem is no one will ever believe what is being said. Mind you, no one could ever make this stuff up since it has become so bizarre.

By the way, why is it whenever there is a screwup on this file, when the answer seems to be spend more of taxpayer money, it is always "in our interest" to do so ie in the taxpayer interest to pay out more and more and more? I wish for once the responsible party would take on the responsibility to solve the problem at their cost, not ours.

The latest:

  • "a small road section in front of the [Detroit/Windsor Ferry's] only access point is privately owned.

    Ferry operator Gregg Ward is concerned what the sudden revelation -- after 18 years of being in business -- will mean for the project and the ferry's future."

But you see is not Mr. Ward's fault that for 18 years he did not know that the trucks that were accessing his site were trespassing over the property of someone else. For 18 years! It seems that it is not his job to solve the problem either:

  • "Ward has asked Windsor city council to help expedite necessary approvals and paperwork that would allow Ontario's transportation ministry to buy a 30-metre stretch of Maplewood Drive."

Nope, it is up to taxpayers to solve this problem so that he can stay in business and to pay for the costs too. I didn't see anything in the story that said that he would be willing to make a financial contribution. Never mind that it allows him to continue to make money, it has to be resolved since

  • "It's for the betterment of the city."

And then we have the Mayor and the City's retained lawyer Mr. Sutts. It looks like the Tunnel deal is dead at a cost of well over $1 million for legal and other fees with no payback to the City. It may be that the transaction can still be salvaged but right now it does not appear to be a go. Check the Detroit papers' websites if you want the latest news.

Of course, the finger of blame has to be pointed at someone for all that wasted time, money and effort. After all, this project has been going on for years with a team of lawyers working so hard in our interest. Whose fault is the failure?

I am sure that you have figured out who it is after reading so many Star stories saying the same thing over the last several days. They have to protect Eddie from another one of his failures. Why it is none other than the owner of the Bridge Company. Blame him. He is the City's so-called "enemy" isn't he. He is an easy target for the Star to cast as the villain. I can hardly wait to see Gord's column too:

  • "Cliff Sutts, who has been leading the tunnel negotiations for the city, strongly believes both Moroun and Alinda are still lurking and poised to make a deal with Detroit, should talks with Windsor fall apart."

It is not Eddie's fault that:

  • the Tunnel is a unique security risk and nothing has been done to solve the problem


  • the City cannot afford the Tunnel Plaza Improvements even though the Senior Levels agreed to pay two thirds of the $30 million costs


  • the costs of the Project have risen dramatically in amounts that we have not been told and for reasons that we have not been told


  • he waited so long that the value of the Canadian side of the Tunnel dropped from around $2-$300M to what it is now...just over $100M as disclosed in the roll-over transaction


  • the Tunnel volumes have been dropping like a stone and the dividends were reduced to zero dollars while he was Chair of the Tunnel Commission


  • he could not find financing for this project for over a year now


  • the deal with Detroit has been changed so many times that one really doesn't know whether this is a loan, a lease, a sale or some combination thereof


  • Windsor Councillors may not approve the transaction in the last minute even if it was to go forward since they have never been provided with sufficient information by him to know what this deal is all about and whether a proper business case can be made for it


  • Windsor citizens, at least as reflected in the Windsor Star Forums on the subject, are almost unanimously against the transaction.

It is because of all of these private operators... the Bridge Company, Alinda, Macquarie Bank... who want to raise tolls skyhigh that Eddie was forced to act even if it made no business sense to do so. He is the commuters' friend and the Michigan tourists salvation. It is his role to spend our taxpayer money to induce Detroit to keep the Tunnel public. Never mind that he uses a private operator to run the Tunnel and has for years.

Of course, if you wrap the deal in the flag of public interest and not Eddie's agenda, then you can drag the Senior Levels into this mess too:

  • "I don't believe there is any question an important facility such as this located in the largest traffic (border crossing) point in all of North America should be in public ownership," Sutts said.

    SUTTS DISAPPOINTED

    He is disappointed the federal and provincial governments haven't done more to stop the private sector from gaining greater control of the tunnel.

    He believes private-sector control would lead to a focus on short-term profits at the expense of long-term sustainability.

    "The City of Windsor has been saddled with the responsibility of attempting to ensure (it remains public)," Sutts said.

    "The assistance of federal or provincial governments should be freely offered to get that completed because it's in the best interest of all Canadians."

Again, we should be so grateful to Mr. Sutts for not charging us legal fees that he would charge to one of his private enterprise clients. As I wrote before:

  • "The other point that I thought was interesting is that I assume that Mr. Sutts is charging a fee to the City for his services that is bordering on pro bono! After all he was the one who talked about private enterprise jamming up their charges as high as possible. Clearly, he only wants to charge "reasonable" fees.

Finally and on a different subject, I thought that Dan Stamper of the Bridge Company has a really good sense of humour. He can afford to have one since he, personally, lives in the US and is not a taxpayer in Windsor. It won't come off his property taxes to pay for a $75 million Tunnel deal after all, especially if there is a default by the Detroit side.

I thought that it was very generous of his Company not to try to outbid Windsor's offer. After all, why would they want to pay about three times more than they originally did for an asset that is aging, declining in value, is losing market share especially if the new DRIC Bridge takes away 25% of their traffic and may require during the term of the deal major capital investment. It is no wonder that he can state:

  • "It doesn't bother me if it goes forward."

He can do the math as well as we can, dear reader, and knows that to pay back the interest and principal of a $75 million loan means that the tolls at the Tunnel have to be increased dramatically so that users of the Tunnel may think twice about crossing over using the Tunnel and use his Bridge instead! And once the Ambassador Gateway project is finished with its new highway connections, imagine how hard it will be for the Tunnel to compete.

I wonder if the "Young Entrepreneur of the Year" considered that in his Business Plan. Ooops I forgot, there is no need for a business case for this from Eddie. It is in our interest to keep the Tunnel public.

I can hardly wait for the next chapter in this border story. What startling event will take place that no one would ever have expected and how much more will it cost us because it is "in our interest!"

Even More News

Here are some scintillating news stories that may not have caught your attention.

BREAKING NEWS: IS THE TUNNEL DEAL DEAD

It seems to be. Check out the Detroit News and Free Press websites ASAP for full details.


A TUNNEL BETWEEN THE OLD AND NEW WORLDS

I had to report this before Gord Henderson found this out and wrote about another tunnel project around the world that he could compare with Greenlink.

This is a photo of the giant drill as it came through the ground in London, England recently near the Tower Bridge to complete the link that is to be found in Brooklyn, New York.

While it is being denied, expect that there will be a strong movement to make this tunnel a passenger one, probably for high speed trains. Expect tremendous airline opposition as well since New York-London is a prime moneymaking route for them. Go to this website to read about the new tunnel between London, England and the New York City area.

Coincidentally, it is the125th anniversary of the Brooklyn Bridge. Bridges and tunnels again.

I know you will not believe it but then again no one expected that Greenlink would be so popular, with City Hall officials anyway.

http://www.tiscali.co.uk/telectroscope/home.php

CANADIAN GOVERNMENT MOVES ON NAFTA FILE

People sometimes ask whether or not BLOGGERs have any real power. Clearly now the answer is absolutely yes.

As you know I have been writing some scathing BLOGs about the stupidity of the Harper Government in its relations with the United States over the free trade agreement. I have suggested strongly that some politicians and bureaucrats in Ottawa are prepared to risk the Agreement over the issue of the Ambassador Bridge.

It appears that finally Stephen Harper has taken charge of this file. Note what CTV news is claiming:
  • "Harper's chief of staff to resign within weeks

    Prime Minister Stephen Harper's chief of staff is expected to step down from his post within weeks, CTV News has learned.

    Sources told CTV News Wednesday night that Ian Brodie is set to leave his position -- most likely in July.

    Earlier this year, the Tories were hounded by the opposition over reports of Brodie's alleged involvement in the so-called NAFTA-gate affair.

    The affair dates back to the March leak of a Canadian consular document involving U.S. presidential hopeful Barack Obama.

    The memo claimed that a senior adviser to Obama told Canadian diplomats that the presidential candidate isn't serious about renegotiating the NAFTA trade deal -- and suggested comments Obama would make on NAFTA are more about political posturing than a real policy plan."

There is no doubt, in my mind at least, that there is a direct connection between my criticism and Brodie leaving. The next question will be when is Ambassador to the United States, Michael Wilson, being told to resign. When that happens, then you will know that there will be an agreement between Canada and the Ambassador Bridge Company immediately thereafter to try and calm down the US Government before our trade with the US collapses completely!


IS THERE AN INFRASTRUCTURE BUBBLE TOO

And, if so, is it about to burst? I asked this question because of a story that I saw on the Sympatico/MSN website:

  • "Is your pension plan in trouble?

    The Ontario Teachers Pension Plan, one of the largest defined benefit pension plans in the country, may have to choose between a sharp cut in benefits or an increase in pension contributions as the fund continues to struggle with a $12.7-billion shortfall...

    Next year, teachers will contribute about 12 % of their gross pay into the plan, compared with 8% in 2006. The government matches that contribution rate. But, that last contribution boost looks like it's not going to be enough.

    Why should you care? Well, even if you're not a teacher, this is a blueprint for what's likely to happen to your own pension plan - if you're lucky to have one to begin with."

The question to ask will be whether pension plans will continue to make huge investments in infrastructure hopefully so that they can get returns that will keep contribution amounts down and keep the benefits up or will they realize that the cost of infrastructure investing may be so high with so many dollars chasing a few good deals that other types of investment will need to be discovered.

Could this mean that a P3 investor for the new DRIC bridge which is extremely speculative in the first place will be much harder to find?

WE NEED A DRIC BRIDGE FOR THE TOURIST INFLUX

That is another myth that is now dead and should not be used as an excuse why we need to spend hundreds of millions of taxpayer dollars on a new DRIC bridge.

I have already explained in a previous BLOG that the Tunnel has not been able to capitalize on the work being done at the Ambassador Gateway project to increase their volume significantly. It just appears that people are not coming to Windsor anymore for a number of reasons I am certain. This phenomenon is not just limited to Windsor as this CTV story points out:

  • "Travel to Canada hit all-time low in March
    May. 20 2008, CTV.ca News Staff

    American and overseas travel to Canada hit a record low in March, Statistics Canada reported Tuesday.

    In total, only 2.3 million foreign visitors, including those from the U.S., came to Canada in March -- a 12.4 per cent drop in travel compared to March 2007.

    March had the fewest number of tourists since record-keeping began in 1972. It also marks a fifth consecutive month of all-time lows for the Canadian tourism industry.

    U.S. residents made only 730,000 trips in March, down 2.5 per cent from the previous month...

    Randy Williams, president and CEO of the Tourism Industry Association of Canada says the StatsCan report is not surprising. His organization has been noticing the significant declines in American tourism to Canada for over five years.

    "Every year we think we hit rock-bottom, and we should start to see a turnaround and it's worse than the year before. We don't know where the bottom of this well is," Williams told CTV.ca.

    Williams believes the American market will continue to slip as long as gas prices are high, the U.S. economy is slowing, and lineups at the border are long because of increased documentation requirements."

FRIENDS AND FAMILY

There are some interesting stories that the Detroit Free Press published recently about

  • "Kilpatrick stocks payroll with friends, kin.

    A Free Press examination of city records shows that at least 29 people with close connections to the mayor have been appointed by Kilpatrick to city jobs since he took office in 2002. That's a significant departure from Detroit's last three mayors, who appeared to have hired far fewer family members or friends."

I wonder what the situation is in Windsor. Is it all based on merit when a person receives a job or does it depend on whom you know? I certainly do not know the answer to the question. Being a relative newcomer to the City, I don't know relationships as well as some others in town might who have lived here for so long or perhaps went to school or were in a social club with the Bigwigs.

Perhaps if anyone is interested you might want to send me connections that you think are valid among the Mayor, Councillors and senior members of the Administration and their friends and families. Might make for an interesting BLOG.

Win a Bluesfest Pass and Help Fight MS

"The weather is getting warmer and the days are getting longer and it’s time once again to prepare to ride from Grand Bend to London and back to raise funds to help in the fight against multiple sclerosis. My son, Brett, and my spouse, Nancy, will also be joining me.

Through the generousity last year of a great many persons more than $700,000 was raised on the Grand Bend ride alone. Nancy, Brett and I were able to raise over $10,000.00 last year through the generous contributions of persons such as yourself. This put us in the TOP 50 fundraisers in all of Canada. I hope I can count on you to help surpass last year’s total.

As an added incentive if you contribute on-line I am pleased to announce that not only will you receive a tax receipt but your name will also be entered in a draw for two tickets to the Windsor Symphony Side by Side performance May 9, 2009. If you contribute before May 31 there will be a special early bird draw for a weekend pass to the Windsor International Bluesfest July 10 – 13 so you’ll have two chances to win.

People living with MS are counting on us. Please click on or copy the following link into your browser address box to make your pledge on-line today.

https://msors.mssociety.ca/Bike2008/Sponsor.aspx?&PID=982585&L=2

Or if you prefer you may also send a cheque payable to “MS Bike Tours” to 1195 Argyle Road, Windsor, ON, N8Y 3K2.

I sincerely thank you for your support.

Many thanks

Wayne Lessard

Thursday, May 22, 2008

Is Francis Suckering Detroit


All of you in Windsorites who want to take a job out West but are afraid to do so because you believe that the airfare costs will eat into your income do not have to despair anymore.

WINDSOR TAXPAYERS WILL SUBSIDIZE YOU!

Yes you heard this properly. My inside moles have told me that the hundred million dollar fund that the Mayor wants to set up is really to subsidize your airfares so that the cost will be virtually nothing for you. You can now go out West to earn a big income and return home every week-end with all that money in your pocket. You do not have to sell your Windsor home and your family does not have to move out West to join you. More importantly, the City property taxes will not decline.

Oh, you think that I'm just fooling. You should know by now that everything I tell you is the absolute truth. How can I prove it to you? Why just take a look at the Star story on the Tunnel deal. How many of you believed that the purpose of the deal was:
  • "ownership of the Detroit side of the tunnel, which was the original intent when negotiations began two years ago."

How wrong you were. Nope, Eddie is prepared to spend $75 million

  • "Instead, the deal would entice Detroit into entering into an agreement to run the tunnel with these arms-length companies, preventing the Detroit side from being sold to a private company."

And why does Eddie want to do that:

  • "because Windsor relies on the tunnel to get Windsor commuters to their jobs in Detroit."

Those big bad private investors would use the Tunnel as a profit centre and increase tolls so high that it would become unusable. That is how Eddie is saving our local commuters' income by subsidizing their toll revenues in effect.

So if it is fair for taxpayers to spend $75 million to help out Canadian nurses working in Detroit and Auburn Hills Chrysler workers from Canada, then it is only fair to spend $100 million to help out people who commute out West. Fare is fair!

What a crock this Tunnel story is becoming.

Does anyone think that taxpayers are truly this stupid. I cannot believe that Eddie would dredge up the stuff about the Bridge Company Owner again as justification for what he wants to do:

  • "Negotiations began on the deal about two years ago with the intent Windsor would buy ownership of the Detroit side -- currently being leased to private company Alinda until 2020. Both Windsor and the Canadian federal government at that time feared a bid by Ambassador Bridge owner Matty Moroun to buy the tunnel's U.S. side.

    "Initially there were legitimate concerns that the American half would fall into private hands with a connecting road to the Ambassador Bridge which would effectively kill or eliminate the entire downtown-to-downtown connection," Francis said."

  • "Mayor Eddie Francis and Windsor council want to prevent investors such Ambassador Bridge owner Matty Moroun or infrastructure firms such as Macquarie Bank and current tunnel lease holder Alinda from using the asset of the Detroit side solely as a profit venture."

The Bridge Company will not need to spend very much money on legal fees when Eddie keeps acting this way and making it so easy for them. Using City money to compete against him with respect to border traffic and then putting impediments in front of him at the Bridge.

You don't really believe that the exemptions from the bylaws with respect to demolition were being done to help out the developers or to improve the area do you? Come on now, you cannot be that naïve after all this time, dear reader! Especially after the US case on the Bridge Company being a federal instrumentality and given what Eddie and David Estrin said at the Senate, the City knows it has no legal position to prevent the Bridge Company from demolishing their homes.

The Planner at Council has already said that, even if the Bridge Company appeared in front of Council asking for demolition, he would not recommend that their homes be demolished until after the Community Improvement Plan is done months from now! Then the Bridge Company will be faced with Heritage designation for Sandwich to stop them.

In addition, unlike some of the developers who allegedly filled their site with dirt from other locations so that kids could peek into neighbouring houses as Councillor Jones talked about or who did not protect their site or had a work order issued so that an exemption made sense, the Bridge Company foolishly boarded-up the homes, made sure the grass was cut and put a chain link fence around their properties to keep out intruders. By acting responsibly, they made it easy for Council to reject their application!

If our Mayor is so public spirited, why is there a toll on the Canadian side at all? Even when the round-trip toll was lower at the Tunnel than at the Bridge, people still did not go there as the Tunnel lost market share to the Bridge over the years.

It really is a shame that the Star Reporter had to travel to Detroit to find out what this deal is all about. I'm surprised to be honest that there was not a lot more coverage about this specific matter in the Star story or perhaps in a Star Editorial. Imagine, not being able to get that information from our Mayor's office easily.

But then again even our Councillors have no idea what the real story is on the Tunnel. Seriously, can you believe it... a $75 million transaction and only the Mayor and his Lawyer know what is all about!

Let me see how this plays out... at the last possible minute, at an in camera meeting, there is an Administration Report setting out how wonderful the Tunnel deal is but of course not providing the agreements themselves for the Councillors to read. Councillors will be told that they must sign off immediately and approve the deal. Once that is done, the Administration Report will be required to be returned so that no member of the public can see it.

Since the Tunnel Company is private, for competitive reasons, the information cannot be made public so that taxpayers will know what the deal actually is.

Wait a minute... that was the arena deal. That cannot happen with respect to the Tunnel.

I will give Councillor Bill Marra credit at least to be fair for saying the following

  • "If the transaction involves both governments, I think the same level of information has to exist on both sides," he said.

    "We are five and a half weeks from the deadline. The last thing any member of the (tunnel) commission or council wants is to make a decision on this in a short period of time. This is a decision that will have impact for many years and due diligence needs to be involved.

    "I won't participate in a last-minute decision."

I'm told by my inside moles that a considerable number of the Councillors feel this way as well and will not be pushed by the Mayor. Whether that is a majority or not, I am not certain at this time. When you get this type of comment from Councillor Postma, one should get very concerned:

  • "I have faith in the team that's working for us, so at this point I await reports from them."

I am afraid Councillor that all taxpayers are not using drug paraphernalia -- such as bongs, glass pipes and hookahs so that their minds are jelly.

Or this one from Councillor Gignac (and by the way she still not responded to my e-mail to her):

  • "With the information put in front of me, I'm comfortable with (the legal costs)," said Coun. Jo-Anne Gignac.

Perhaps we might get lucky and those who would not give the Mayor a blank cheque on the University Engineering Complex will feel the same way with respect to this transaction.

I guess the Powers-that-be on both sides of the river have forgotten that the transaction cannot go through until the Federal Government signs off on it because of the transfer of the assets of the Tunnel from the City to a new private Company. That is what the International Bridges and Tunnels Act is all about isn't it. I thought that ownership regulations would not come out for about a year after the passing of the Statute. If the Federal Government does something quickly to help out the City with respect to the Tunnel, then imagine what the Bridge Company will say in arguing that the Federal Government is discriminating against them. More problems I fear for this deal.

Let's come back to the Detroit side now. I must admit that I do not understand the deal whatsoever based on what the Star has written. It makes no sense to me at all. After all Eddie said:

  • "Do you really think the city would borrow money, lend money and then be on the hook for the money?

    "Negotiations are ongoing and no one should jump to any conclusions. You can't comment until things are done. Things change."

So this means that there is more to the deal than even the Star knows or Detroit Council! That should make some people even more furious at Detroit City Hall.

It looks like the Windsor Tunnel Company will borrow the money from Ontario and send $75 million to the new Detroit Tunnel Company. Note as well that we don't know exactly how much money Eddie is actually borrowing. We are assuming that it is $75 million. Do not forget that there is a promissory note from the Windsor Company to the City for over $100 million as well. Wouldn't the City like to see that promissory note paid off at the same time? Is that what this deal is really all about? Is the Windsor Company actually borrowing $175 million or more? I am merely speculating. I do not know.

The Detroit Company presumably pays off the purchase price of the Tunnel by sending money to the City of Detroit. We are told that Detroit is not on the hook for the repayment, just the Detroit Tunnel Company. I assume that's how you get the Detroit Council on side since there is no liability and the City gets all this money for its Tunnel interest. Of course, someone makes a ton of money on fees on the Detroit side too.

Here's the interesting part though. The only money that the Tunnel Company gets is $600,000 a year from Alinda for the next 12 years until their contract expires. Windsor borrows at least $75 million, and even assuming a 5% interest rate, that is more than $600,000 is it not? How does the Detroit Company pay the outstanding interest?

Does it mean that the Detroit Company is in default within the first year of the transaction taking place? Alternatively, is a deal structured so that no interest is paid for a dozen years so that at some point in time the interest outstanding plus interest on top is added to the amount of $75 million and then repaid? I have no idea.

I ask this question because the Ontario loan is for a maximum of 40 years according to the government website and yet we are told that

  • "a Goldman Sachs report prepared for Detroit that looks at projected toll revenues, repair costs and interest expenses, concludes it could take 45 to 50 years to repay the $75 million."

Of course, Windsor Taxpayers may be directly on the hook if we have to guarantee the loan to the Ontario Government or we could lose the asset entirely if the Windsor Tunnel Company defaults. Again I do not know the answer to this.

That overly complicates the transaction so let me try and simplify it. Let's assume it's like a mortgage on your house. You borrow money from the bank and agree to pay them back, principal and interest. If you default, the bank forecloses.

Is that what the real deal is with the Detroit Company? Within the first year since the Detroit Company cannot pay interest on the amount borrowed since they only received $600,000 a year from Alinda, the Windsor Tunnel Company forecloses on the Detroit side and now is the owner of the whole Tunnel.

It is not set up as a sale transaction because Detroit Council would go nuts if that was ever attempted by the Detroit Mayor but it is structured as a loan with the same result. Would this also get around any applicable US laws that might be involved or US Homeland Security concerns if Windsor took over the Tunnel on a sale since the Tunnel is a unique security risk?

It is a conclusion that a reasonable person could arrive at because frankly the amount of $75 million for the Detroit side seems unrealistic given that the Bridge Company offered substantially less and the Canadian Federal Government walked away from the transaction. Remarkably, the amount being offered would pay off the Detroit budget hole.

Can one conclude that someone started working backwards instead saying here's how much money is the minimum we need to pay to get Detroit onside and then figure out a way to do it with the Tunnel? Again, I have no idea.

Let's assume that Eddie Francis is correct in saying that the value of the Canadian side alone is worth $2-$300M as he said a number of years ago. What does that make the entire Tunnel worth? Much more than $75 million to Detroit plus the hundred million dollar promissory note from the Windsor Tunnel Company to the City.

Is this our Mayor taking advantage of the financial position of the City of Detroit? Is he negotiating a very low price so that he can make a huge capital gain down the road by flipping it to a private investor or to the Feds? I wish I knew.

There is something going on given all the secrecy. I find it remarkable that the Gord Henderson column today is concerned more about the Toronto Star articles about windsor than about the Tunnel deal. I find it strange as well that the Star has not written one single significant Editorial about this given all of the attention on the US side.

At the least, I would have expected a thundering Editorial about all of secrecy involved including the fact that our Councillors seem to know nothing. I would have expected the Star to be furious that its reporter had to go to Detroit to find out information about this deal. They could have had fun with our lawyer's use of the word "confidentiality" again after the Privacy Commissioner ruling on the Spitfires' lease:

  • "Sutts pointed to a confidentiality agreement surrounding the negotiations which restricts his comments on the $75-million figure."

No, there is an agenda at play. I just don't get it. The City of Windsor cannot afford to spend money for years for the Tunnel Improvement Project in which the Senior Levels are paying two thirds of the costs (and we know that the costs have risen far above the $30 million originally budgetted but we do not know the exact amount yet) but we can borrow $75 million to cure Detroit's budgetary issues.

Without full and complete disclosure now, this is insanity at taxpayer expense.

This is our Mayor playing entrepreneur again with taxpayer dollars to achieve some result that we know nothing about. The Star article today is nothing more than building in a defence so that if this deal disintegrates and falls apart with taxpayers having to pick up the dollars, the Mayor can say it was not structured as a business transaction. Rather it was designed to stop Matty Moroun in the public interest!

What a crock of....oooops I had better watch my language or I might start sounding like local Councillors talking to their colleagues.

Thickening In The Head


Wow. Someone should get the franchise over using the newest buzzword "thick" when describing impediments to quick crossing at the border. If I owned it and received a nickel for every time it has been used recently, I would be rich today!

I did not spend a lot of time looking for the date when the word was first used in relation to the border but it has been around for at least 5 years. It just seems that it has been in vogue relatively recently. Everyone seems to be using it from politicians to reporters to members of different associations.

Here are just a few references I have seen over the past few weeks
  • "One of the goals that Canadians and Americans have is to thin the border," Ganong said Wednesday.

    "After 9/11, the border, if you will, got thicker."

Can't you just see it, Richard Simmons doing his "Sweatin' to the Oldies" exercises at the next SPP meeting trying to thin the thick border. I wonder what kind of gym clothes Harper's stylist would pick out! Here are some more examples:

  • Traffic at border crossings can also thicken during long weekends. Therefore, it’s a good idea to check in advance to see if there are delays

  • Yet delays triggered by the unexpected have risen every year since the 2001 terrorist attacks in the U.S.

    "It's not in anybody's best interest - it's not in the United States' best interest and it's not in Canada's best interest to have a border that simply acts as an impediment to trade so that economic activity is halted," Mr. Kee said.

    Experts have dubbed this phenomenon a "thickening" of the border.


  • Prime Minister Stephen Harper and Industry Minister Jim Prentice have also recently warned that "thickening of the border" is costing business heavily on both sides.

    Beatty reiterated those concerns Thursday to The Journal's editorial board. He said Canada-U.S. trade differs from that between other countries.

    "We don't just ship them wheat and buy car parts. We make stuff together. We're highly integrated ... so smooth functioning of the border is more important..."

    Potential investors are likely to set up shop in the U.S. to avoid the border hassles, he said.


  • Faced with the thickening of the U.S-Canadian border and the downturn in the American economy, Canada is setting the stage for free-trade talks with the European Union. Preliminary studies have been ordered and in October, Prime Minister Stephen Harper and French President Nicolas Sarkozy will decide whether to give the green light to begin formal negotiations towards a new, trans-Atlantic free trade deal.


  • PBOA President Stan Korosec, who is also Vice President of Operations for Blue Water Bridge Canada, agrees with Bradley. "Our members are also concerned about the thickening of the border," says Korosec. "We have been meeting with representatives of the Department of Homeland Security and U.S. Customs and Border Protection since the summer long delays experienced in 2007 and are pleased with their efforts to date to facilitate legitimate trade and tourism without affecting security. We hope that the Canadian Government allocates the proper staffing and resources to the Canada Border Services Agency (so that similar delays are not experienced coming into Canada this summer)".

  • The warning echoes criticisms about a "thickening" border imperiling trade and productivity made recently by the North American Chambers of Commerce and the North American Competitiveness Council.


  • Prentice sounds alarm over ‘thickening’ U.S. border


  • Prentice's warnings about the "thickening of the border" were much more pointed than those Prime Minister Stephen Harper raised last month at a summit with U.S. President George W. Bush in New Orleans.

  • Interminable lineups, frustrating delays – time is money, and these days, both are a-wasting at the 49th parallel...At a time when globalization is supposed to be bringing countries closer together, business leaders are bemoaning what they describe as a thickening of the 49th parallel.

  • Canadians have reason to worry that American fears of 9/11 terror, coupled with raw presidential politics, put trade at risk. Washington is intent on “thickening” its borders with Canada and Mexico in ways that hurt our common $1 trillion trade, even though recession threatens all three countries.

  • about thickening the border, a phrase I'm well aware of, we have consistently -- and I'd say, more appropriately, the Department of Homeland Security has consistently tried to work with the Canadians, to be as transparent as possible with them, explain to them kind of the process, what we're doing, how we're going about it, trying to make sure that we meet all of our legal requirements, but we also facilitate trade and travel.

Bureaucrats who really run things, especially American ones, should be very familiar with the term "thickening" since it has been used to describe them and how they act! The Brookings Institute wrote:

  • "The past half century has witnessed a slow, but steady thickening of the federal bureaucracy as Congress and presidents have added layer upon layer of political and career management to the hierarchy. The past six years have been no different. Despite the president's promise to bring business-like thinking to the federal government, the Bush administration has overseen, or at the very least permitted, a significant expansion in both the height and width of the federal hierarchy. There have never been more layers at the top of government, nor more occupants at each layer.

    The impact of the thickening is in the headlines regularly. Information must pass through layer upon layer before it reaches the top of the hierarchy, if it reaches the top at all, while guidance and oversight must pass through layer upon layer on the way to the frontlines, if it ever reaches the frontlines at all. It is little wonder that no one can be held accountable for what goes wrong or right in government, especially in a hierarchy where presidential appointees serve for 18-24 months on average, and information is often delivered by word of mouth through a process that has come to resemble the childhood game of telephone. "

Read part of a press release from the C.D. Howe Institute back in 2003. This probably helps explain why border impediments or Senator Kenny's "Dirty Little Secret" really exist:

  • "In a Commentary entitled “Risky Business: U.S. Border Security and the Threat to Canadian Exports,” Danielle Goldfarb, policy analyst with the Institute, and William B.P. Robson, senior vice president and director of research, say there is a compelling need for a broad new agreement on North American economic and security integration to lessen the vulnerability of cross-border trade. Recent border tightening by the U.S. in advance of a planned invasion of Iraq provides clear evidence of the need.

    “In the event of another attack, Canada will again be a target of U.S. complaints, partly because of legitimate concerns about inadequate security [in Canada] and partly because many Americans will be reluctant to accept blame for failings on their own side,” Goldfarb and Robson say in the Commentary, part of the Institute’s Border Papers series. “One small security flare-up linked to Canada could have major economic consequences.”

    The authors estimate that in the event of future actual or feared attacks, border disruptions directly threaten key sectors of the Canadian economy that account directly for as much as 45 percent of Canadian exports, 400,000 jobs and $3.7 billion of investment, as well as another half of each of those amounts for sectors that are indirectly vulnerable. The study adds that Ontario, Quebec, Manitoba and P.E.I. have the greatest proportions of highly vulnerable industries...

    The authors add: “Effective ‘thickening’ of the border by extra security measures threatens to deprive Canada of the advantages — in particular, investment by producers seeking to serve the entire North American market — that trade liberalization within this continent has conferred.”

Want more? Here is something for you to read. Check out the Globe and Mail story on their website published on May 17 :

  • "DEAD END FOR FREE TRADE

    NAFTA was meant to deliver timely, unfettered access to Canada's biggest trading partner. Instead, delays are longer, costs are higher, and business models are breaking down"

Of course you need to round out your education by reading what both the Brookings Institute wrote ("The Vital Connection: Reclaiming Great Lakes Economic Leadership in the Bi-National
US-Canadian Region") :

  • "The largest challenge to further economic integration is posed by homeland security concerns and measures that have slowed border and bi-national economic exchange since 2001."

and the latest Report by the NORTH AMERICAN COMPETITIVENESS COUNCIL:

  • "The NACC continues to favor a more comprehensive approach to reducing border congestion that would entail shifting the customs clearance process, to the extent possible, away from ports of entry, and toward the inbound side of choke points such as border bridges and tunnels. In the longer term, as many inspection processes as possible should be moved away from the border."

Why am I telling you all of this? It's very simple. The problem of the border simply has little to do with a bridge or a tunnel no matter where located on the border between Canada and the United States. The bridges and tunnels in themselves are not responsible for delays.

Oh you will see the odd comment about Windsor/Detroit in passing (I mean really, the Governments will have spent on both sides of the river $50-$6M on the DRIC report by the time it is done so someone has to say something about it) but when you read all of these reports and read all the stories, the issues come down to Customs, Homeland Security and the US need for security.

That is why as I have said before I do not understand why the Canadian Government has decided to take on the United States over the Ambassador Bridge issue and is making such a big deal about it. It is such a small part of the whole free trade issue but it can become another softwood lumber issue easily if someone chooses to make it one.

NAFTA is at stake and a good part of our prosperity if we do the wrong thing. We cannot win if the Americans decide to look inward and become more protectionist. We can play elephantine but we are still the mouse in the end.

Accordingly, there is no point in the Prime Minister threatening the President of the United States with Canadian oil at the SPP meeting nor having an Industry Minister try to confront the President when they're both delivering speeches at the same conference nor leaking news stories to the CBC French language network stating things that the Americans are in no position to do at this time because of the law.

It makes no sense to embarrass a sitting Republican President nor to dismiss a possible Republican Presidential candidate as being unelectable by our Government's actions. Why hurt your friends?

It makes no sense to try and determine which Democratic candidate might be the choice in running for President, especially when one guesses incorrectly, and then compound that error by stating that you want to do a deal before that person becomes President. Why hurt your new friend?

Next time you see the word "thick" in relation to the border you probably will understand better what it means after you have read this BLOG.

Don't forget it also refers to the brains of certain bureaucrats and politicians who have not got a clue as to what they are doing other than destroying the relationship between Canada and the United States over one bridge in particular.

Is it really worth it?

Wednesday, May 21, 2008

Letters From The BLOG Readers




Here are some more comments from Readers just like you.

And if you want some fun as well, check out the emails on
http://www.themunicipalgremlin.com/ Try and find out if there are [Expletive Deleted] ones:

1) The cat is finally out of the bag. We now know where the downriver span is supposed to go. Bucks will come pouring down in the mega billions, and not just for Windsor-Essex.

Here goes: 2.6 billion for the DRIC-Greenlink-pie-in-the-sky road to the EC Row Expressway, at least a billion more for the Canadian half of the "new" Brighton Beach bridge and plaza and another 300-400 million so that trucks can get to it. Wow! And that's just on the Canadian side.

No doubt the Yanks will turn cartwheels of joy as DRIC gently explains that their taxpayers should cough up another billion or more for their half of the sparkling new bridge and plaza and millions more for connecting roads to their interstate highways. Never mind that the Americans are already spending at least that much to connect I-75 and I-96 to the Ambassador Bridge.

There will be so much construction in the border cities that Windsor's new arena will seem like a weekend fence building project. Since neither Detroit nor Windsor has any money to pay for any of this, maybe the two mayors can organize tag days and rummage sales to get the ball rolling. Taxpayers on both sides of the border, open your wallets!

2) I wonder if the city would give me the same deal on the Airport as they did
for the Spits?

3) Who would pay for policing and fire of the Detroit side of the Windsor controlled tunnel?
How much of the plaza on the other side would Windsor have to pay taxes for?
Taxes on the tunnel to the City of Detroit?
Maybe Kwame is a little smarter than Eddie.
He can turn around and charge Windsor millions for protection services.
Just a thought.

4) I have been through those trips to London with my brother for several operations over nine years and they aren't anywhere near fun! So I kind of know what you went through on the weekend. Hoping that everything is okay!!

5) Your latest blog on the traffic presents both a compelling legal and technical arguement for not constructing a new bridge through DRIC!

6) So were Buzz and Lewenza born in a manger on a winter night? They are happy to accept the largesse of the Premier to throw tax dollars at the auto plants and then keep the man hour cost in the $80 per hour range when it is sharply lower in the USA. I have no doubt what this leadership is going to do to our remaining unionized auto industry in Ontario. Let's hope Toyota, Honda and Suzuki continue to operate competitively.

Then we bring in these guys to solve municipal disagreements with the province

7) Ed, I hope that every thing is going well with your wife. Many of us have had to go out of Windsor to get medical treatment that is currently not available here. This practise although necessary is difficult on the patient and the family members. Hopefully more and more of these special procedures will be done locally in the not to distant future.

Excellant comments and observations in todays Blog. May I suggest that the money that could be saved as you suggest. be used to set up a Fund for the University of Windsor expressly for research to eliminate and/ or collect then destroy the exhaust emissions from the trucks.
As you know neither the Dric plan nor the Windsor Geen Link plan really address this key issue!

8) Good Morning Ed,

I was sorry to hear about your wife's health issues and the added attendant emotional, physical and financial toll on families when out of town health care is required. I hope she is progressing well and on track for a full and speedy recovery.

As an aside, this is another vivid reminder of the need to ensure that every tax dollar is used wisely to maximum benefit since needs invariably exceed available resources.

Take care and best wishes for good health and happiness.

9) [Re BLOG Long and winding road]Unfortunate typo: Long and “winding” road should have been “whining” road

10) [RE W.E. Did] Great column Ed!

I thought the EXACT same thing when I read that load of hogwash in The Star.

I agree that saying positive things about Windsor is important but why gloss over all of the negatives? Do we not strive for 100% or is 60%, 80% or 99% "good enough"? I am from the persuasion that you never stop reaching upwards regardless if the goals set. In Windsor we don't reach, we expect others to come down and hand it to us. That is the mentality that has been cultivated here for 20 years.

You know the saying. "It is easier to demolish to divide than it is to build and come together". No wonder thy city wants to sue everyone and do it their way....

11) [Re Long And Winding Road] EXCEPTIONAL BLOG

12) [Re: More On The 400 Building Audit] As ALWAYS, it is not so much the misbehavior as the cover up that has become the story! Will they never learn!

13) You were right on the money with the Library As The City column. How dare Eddie complain about the process at the library board when he himself conducts the too numerous in-camera meetings when he ran on a platform of city transparency. What about the severance of the numerous CEO's of the WEDC? What about Manager's at city hall being let go.

All this tells me is that what is good for everyone else isn't good for Eddie.
Can Eddie refute any of the facts laid out in your column? I don't think so.

14) If there ever was a critical role for Windsor to play it was to demand that DIBC build a new bridge ten years ago. And then, from an insider position, to work to develop the best roadway and inspection facilities possible.

15) I would like to say that I am a frequent reader of your blogs as well as many others on the WE Speak Blogroll. I would personally like to say thank you for being so supportive of the library board and telling it like it is.

16) How dare they compare us to Tijuana, here in Windsor and the rest of Ontario, our women can legally go topless in public, they can't do that in San Diego or Tijuana. Hey maybe I'm on to something here, better contact Eddie and the tourist board!

17) If I am to " Tell your MPP the solution is Greenlink" why am I asked to mail this card to the City of Windsor?

18) Keep up the good work- your blog is a vital voice in the new communications era.

19) Looks like Transport wants someone to pay for road and bridge. Only a fool would consider that to be a benefit to our region

20) Has anyone fiqured out the yearly payments on a $75M loan?
Even using a 30 year amortization payments are well over $5M per year. I thought I read the yearly income from the tunnel operation somewhere but if it does not cover the payments then what?

21) Unfortunately, the Commission is a rudderless ship in stormy seas in dire need of a seasoned helmsman!

22) [Re Making DRIC bureaucrats accountable] Au contraire, blogmeister. You can be assured that Matty Moroun knows how much his new bridge will cost and he can state with some confidence how many vehicles will use it. He can also tell, maybe better than anyone at DRIC, what theirs will cost and what they will have to charge in tolls to recover its cost. . .as if that matters to government.

23) A bureaucratic mind is a beautiful thing, I have watched them all my professional career(s), in the army, in federal offices in Ottawa, in our city hall and indeed they are beautiful. NOT! These minds are anal retemptive, focused, precise, filled with their own glory, their own perceived righteousness that they know The Way and we don't - the great unwashed! They make the rules, they apply their rules, they ignore their rules and they practice Kow-Towism to their political masters while secretly smiling to themselves that their political masters are only here for a moment of their glorious time on Earth. Their attention to detail is famous throughout history, their willingness to obfuscate with obtuse archaic language that only those that are willing to submit to high salaries for no perceived work will know. The universe is large but yet they can even pigeon hole that neatly into a row of boxes because they know.

I believe that they are cloned from one universal source hidden away in the mists of time, they run the gauntlet from front line clerks to the apex of governance.

And all my life , I have been their foil, working in these bureaucracies is fun, watching them make rules and procedures, only to be hoisted on their petard when the rules/procedures don't make any sense at all, only unto themselves. I have enjoyed my work and its bureaucracies, they make me laugh and think every day. When they strived for precision and neatness, I strive for chaos and messiness.

I think everyone one should read a new book out titled: Everything is Miscellaneous by David Weinberger, it truly refutes the bureaucratic mind.

Keep writing Ed, I have learned more of our situation here in Windsor from you and the other bloggers than I ever will from the Windsor Star, television media and of course our pet City Hall.

24)I would bet that the owner of the ambassador bridge has a cost package to the last dollar for his new bridge., because he is one smart dude.

25) I don't believe that there's a cat in hell chance of a third bridge. It's just socialist lunacy and Harper should declare it a non starter. Canadian politicians in particular make me sick

26) if I were to build a house for $200,000 and rent it to you for $1,000 a year, to include maintenance, taxes, and utilities, which of us would get the good deal? Multiply that by 150 and what do you get?

27) Is the city going to plant those flowers so low that drunken American kids can pee in them? Is that what the city means by self watering? I'm confused!

28) Interesting but sad, that we Windsor have to read out of town newspapers to get news of Windsor.

The Authority As The Authority



It seems that whenever someone wants to talk about a public bridge authority the invited guest is a representative from the Buffalo and Fort Erie Public Bridge Authority (PBA). Ron Rienas from the PBA has been down here so often it seems over the last few years. Hmmm I wonder if he really comes down here to watch how the Ambassador Bridge people run a border crossing so that he can learn from them.

I am sure that you remember that comparison that I have quoted before that demonstrates the differences between the two crossings:

  • "A US Federal Highway Administration Report stated:

    "the scatter plot of the Ambassador Bridge Crossing comes closest to the "ideal" shape demonstrating a consistently low crossing time for both inbound and outbound traffic. At the other end of the spectrum, (...Blue Water Bridge, and Peace Bridge crossings respectively) have a less desirable distribution of volume/time data points...

    Crossing times at the Ambassador Bridge POE are clearly superior and more consistent than any other port of entry in the study... Further, lower crossing times are achieved despite the bridge having a consistently higher volume of traffic...

    "For example, at the Ambassador Bridge, the buffer index for inbound truck traffic was just over 65 percent. This indicates that, even with its substantial volume of traffic, operators of the Ambassador Bridge sustained movement across the bridge without imposing lengthy increases in delay times. Contrasting markedly with this was the inbound buffer index at the Peace Bridge of 266 percent."

Now one would think that the PBA was the big enemy of the Ambassador Bridge Company since they want to build a competitive bridge in the PBA's backyard. I would not think that the PBA would want their competition. Therefore one would expect that when Rienas comes down to our region not only does he do so to help us understand the "virtues" of the Public Authority concept like the PBA but also to attack the Bridge Company.

Interestingly, a reader sent me a recording of his testimony before a Michigan House Appropriations Transportation Subcommittee Hearing recently. Actually, when you listen to what he has to say, he could turn out to be the bestest buddy of the Bridge Company. If I did not know who it was, I would have thought that it was Dan Stamper speaking.

How can anyone argue with what the Bridge Company is saying after the representative from the PBA says the same thing. DRIC will have major problems now trying to discredit the position of the Bridge Company!

Let me give you some examples:

1) The total volume of all the Niagara area bridges is 14M vehicles. Volumes have trended down over the last decade, especially after 9/11. Customs causes back-ups primarily into US, not volumes. [Isn't that exactly what the Bridge Company has said. The issue is not capacity therefore as DRIC would like us to believe]

2) Rienas identified that the Whirlpool Rapids Bridge is NEXUS only. Lewiston/Queenston Bridge was expanded to include a FAST lane. [One of the reasons for the Enhancement Project is to add a third lane in each direction on the bridge so that FAST and NEXUS vehicles can have a quick way across the border.]

3) Their capacity project is not a transportation project---rather it is a border improvement project that encompasses transportation but includes other factors ie modernize their plaza to meet Homeland security and CBSA requirements,improve plaza for Border crossing (eg NEXUS lane), redundancy, make maintenance easier, get special loads across much quicker, reduce environmental impacts, economic benefits ie make it easy for industry to know that goods can get across properly, remove border impediments) [Gee that sounds like an Enhancement Project rather than adding new traffic capacity, obviously because traffic is down]

4) They already have 14 lanes of border crossing in their region and still they have back-ups. [The issue is not adding more lanes over a river as DRIC would have us believe. It’s not just a transportation issue but a border issue ie Customs especially into the US]

5) With their project---They looked at a lot of alternatives up and down the river as DRIC did. The crossing location chosen was right beside their existing bridge. Capacity was #4 on the list of reasons for the bridge. Improving border crossing operations and making it safer are the main factors. [Just like in Sarnia, they looked eveywhere but chose to build beside the existing structure since it made sense from a border crossing perspective. Unfortunately for them, PBA has major Community issues where they want to build their expanded plaza unlike the Ambassador Bridge.]

6) While he does not reject the P3 concept saying private entities have their place, Rienas does not seem to care for them for obvious reasons. Instead he suggests that they are acting like a private entity like the Ambassador Bridge Company: Structured as an arm’s length entity, totally self-sustaining, debt not guaranteed by any Government, has to pay off bond-holders first, has to go to Wall St. just like a private entity for its new bridge for money, will have to prepare a prospectus, do an investment grade traffic analysis.

Of course there are some differences. Mr. Rienas likes talking about the low tolls at his Bridge. He claims that they only charge what they need to function and operate the bridges. Their objective is to keep tolls as low as possible since they do not want the tolls to be a disincentive to travel. He tells us that his operations are totally self-sustaining, do not rely on public funds for any of their operations for the bridge and the crossing although they have received infrastructure money for connecting road issues.

Unfortunately, he neglected to mention to the Hearing that they are asking for a $90 million from the US and New York State Governments for their project. That might be one explanation why their tolls are so low because in this case the users do not pay but the Governments would. Another explanation could also be that the Bridge Company builds facilities in advance like the six Customs booth on the Canadian side and has already invested a half billion dollars of its money for its Enhancement Project.

One other difference is that in Niagara the various Authorities work together and manage traffic on a mutual basis. Mr. Rienas obviously never dealt with our Mayor who has lost sight of the fact that he was elected as Mayor of this City and not as a border operator.

If he had more time I'm sure that Mr. Rienas would have said other things such as these that he mentioned in another interview of his that I read:

  • Shared border management really died because there was an impasse reached between the government of Canada and the government of the United States. Secretary Chertoff, in April, basically said that there was an impasse between Canada and the US, primarily because the US was unable to perform all of the functions in Canada that they were able to at all other border crossings: search and seizure, arrest, fingerprinting....the loss of shared border management was a huge disappointment to us [Had that been resolved, the issue of Redundancy and Security would have become a nonissue for every border crossing]

  • Ideally, we would have the European Union model, which is that of perimeter security, where there is a perimeter around us of security between Canada and the US because then you wouldn’t need plazas. You wouldn’t have to do all of the things we’re talking about doing. It would be a free-flowing border with everyone going across and everything going the way it should be going. [In effect, we are getting a virtual border now with many of the new techniques of preclearance. That means again that the need for additional capacity or lanes across the River is reduced]

  • As processing has changed, particularly post-9/11, it’s taking longer and there are different criteria and different parameters to get across the border. The only thing to compensate for that is the increased infrastructure that you have. It doesn’t necessarily mean that more people are going to cross; it just means that we hope to eliminate a lot of the congestion that we are experiencing in the bridge right now. [Again, additional capacity is not required and means nothing. What is required is improved Customs facilities to prevent "thickening" of the border and less regulation and impediments to legitimate border crossers.]

  • Since 9/11, there has been a decrease in traffic, but an increase in congestion. [Is that the "dirty little secret" that the Canadian Government is so concerned about and which their recent actions have caused a real chill in Canada/United States relations.]

Here's the clincher that should end DRIC and allow the Enhancement Project to be expedited:

  • BJ: ...why do you need three more bridge lanes?

    RR: It’s important to understand that the bridge is actually an extension of the plaza.

    What I mean by that is that the expedited programs, the low-risk programs like FAST or NEXUS for cars that are operated by both governments, only work in the case that you can get to your booth, your NEXUS booth or FAST booth.

    You have to look at it all as one system, because having dedicated NEXUS and FAST lanes really extends the plaza all the way across the river all the way over to the QEW in Canada, and that makes a tremendous difference to the functionality of the bridge. Right now, if you have a NEXUS card and a booth on the other end of the bridge, but there’s traffic on the bridge, it is not doing you any good.

    You have to treat the bridge as an extension of the plaza, and that’s the difference with a bridge crossing the Niagara River, an international river, and a bridge crossing the Mississippi River. In our current environment with the traffic volumes right now, in the case of the Mississippi River, we wouldn’t be building a bridge. We’re building a bridge because it has to be part of the border system... we’re building it to make the border work better. That means accommodating all of the NEXUS and FAST needs... If you were a NEXUS cardholder, you would have a dedicated NEXUS lane right on the bridge. That’s the intention."

If Mr. Rienas continues to speak this way, I would expect that the number of invitations that he receives to speak in this region in the future will dry up very quickly.

Tuesday, May 20, 2008

More Quick Thoughts

I wonder if you have thought about the same things that I've been thinking about over the last few days.


DRICONIAN SLIP


video

Quite a slick video put out by the DRIC people. However, did you notice the "slip" that they made. Was it deliberate, a signal to the Bridge Co.? This says to me that the beginning of a compromise solution between the Ontario Government and the Ambassador Bridge Company may be possible over the road even if the Feds want to fight.

Around the 6 minute mark of the DVD, you would hear the following if you click above:

  • "The Windsor Essex Parkway is the right solution now. This will be the most expensive highway project in Ontario history and will lead to an estimated 12,000 full-time project-related jobs in Ontario…Imagine, a better border network with a modern roadway serving new and existing border crossings. The Windsor Essex Parkway is the right solution now."

Guess which crossing is the "existing" crossing being referred to. Yes, that's the one. Did that surprise you? It shouldn't have.

It looks like the Ontario Government has finally figured out that they need to build a road to the Ambassador Bridge after all. The compromise: Ontario will call this the "intermediate solution" until traffic picks up, say in 40, 50 or 60 years from now (See Transport Canada remarks below).

And they will not have to spend half of the $1.6B or more to build the ridiculous DRIC road.

BY THE NUMBERS

Here are some interesting numbers that help explain why a new bridge with new capacity is not needed in the region until perhaps 2040-2050 or later (according to Transport Canada). It may explain why a new DRIC bridge would have to cannibalize the trafffic from the other border crossings to make it viable for a P3 investor to survive thereby putting the other crossings into financial difficulties. Government subsidization would them be needed to keep them operational or they would risk bankruptcy:

  • TORONTO, Ont. -- Ontario truck crossing statistics issued earlier this week by the Public Border Operators Association (PBOA), shows that international truck traffic is down 5.6% in the first four months of 2008 compared to the same period last year. If the timeline comparison is extended to 2005 the decrease in international truck crossings is 8.4% which could translate into 900,000 fewer truck crossings in 2008 compared to 2005.

    "Trucking activity is a leading economic indicator, and these numbers are yet another sign that the Ontario economy is going through a series of challenges that requires rethinking on the parts of all levels of government," said Ontario Trucking Association president, David Bradley.

Do you think that this is the reason that Sean O'Dell of Transport Canada is talking about a time period outside of the mandate of DRIC, and which has NOT been studied, to justify wasting billions of taxpayer dollars on an unneeded crossing:

  • "I don't think that is an excessive amount [number of lanes] for long-term growth that we will probably see for the next 40, 50 to 60-year period."

WHY PUBLIC BRIDGE TOLLS ARE SO LOW

I know, I know. We need a public Bridge in Windsor/Detroit because the tolls are too high at the private Ambassador Bridge. Oh forget about the fact that the Cities owned Tunnel fares are higher because that just hurts the argument. We don't not need facts to confuse us.

The model for a new public bridge in this area is of course the Peace Bridge. Hasn't Brian Masse mentioned that Authority so many times already, and even brought Ron Rienas from the Peace Bridge here for a meeting, and bragged about its low tolls.

There are some quotes that I have posted before that you may have forgotten about public Bridge tolls"

  • "Ron Rienas, General Manager, Buffalo and Fort Erie Public Bridge Authority stated:
    "The Peace Bridge is very similar in a sense that we operate much like the Niagara Falls Bridge Commission with private sector principles."

  • "...most not-for-profit international bridges are already bound into major infrastructure expansion programs financed by private United States bond issues. The indentures already include fairly aggressive toll increase schedules over the next decade calculated to the maximum point of consumer resistance."

  • "...but I can tell you that all of my toll revenue is first pledged to the bond holders. The bond holders get paid before I do. The bond holders get paid before the bridge is painted. The bond holders get paid before we build facilities for Canada Border Services Agency."

I just found out a new fact. Here may be the reason why a public Bridge can have a lower tolls than a private crossing. When they need money for bridge improvements, they don't ask the users to pay, they ask the Governments to pay! Here is what the Peace Bridge Authority has requested from the US Federal and New York State Governments:

  • "Greater Buffalo-Niagara Regional Transportation Council
    2030 Long-Range Transportation Plan


    Proposed Amendment--Peace Bridge Capacity Expansion Project

    The Peace Bridge expansion project is documented in the Greater Buffalo-Niagara Regional Transportation Council’s (GBNRTC) approved 2030 Long-Range Transportation Plan (LRTP) as a regionally significant transportation project expected to impact area travel patterns and to be financed with non-federal revenue sources...

    The purpose of this action is to amend the approved GBNRTC 2030 Long Range Transportation Plan to include the Peace Bridge Capacity Expansion Project among those regional project priorities to be funded with federal revenue sources in addition to previously identified non-federal sources...

    The fiscal constraint of the LRTP would be adjusted by assuming new federal project demonstration funds and new state dedicated funds to finance a portion of the Peace Bridge Capacity Expansion Project. Those combined federal and state funds have been estimated at $90 million. The remaining portion of the total bridge cost would be financed with committed funding from the PBA, the Canadian government and an existing FHWA earmark....

    Tentative Funding Plan (Yr of Construction)
    1. PBA $ 230 M
    2. Canada $ 76 M
    3. FHWA Earmarks (Existing) $ 18 M
    4. State/Federal Earmarks $ 90 M

Now I get it. That's how they keep their tolls so low.

MORE TORONTO FALLOUT FROM THE TRAIN TRIP

I'm sure that you read as well as I did the nice pat on the back letters that Eddie and Sandra wrote to themselves for the party in Toronto that were published in the Windsor Star on Saturday. It was good stuff to keep the home folks thinking they are actually doing something that might help our economy.

I already told you about the Globe and Mail story that made fun of Eddie's job plan to fly people out West. Now have you seen the Toronto Star stories on the weekend that compared Windsor unfavourably with the economic boom developing in Sudbury.

Unfortunately, business people will get a very unfavorable description of our City Government and the mistakes that they have made. Again, a problem to overcome that cannot be blamed on naysayers and whiners.

While the stories written were pretty factual, there is no doubt that the Star writer was not impressed with what is going on in Windsor. The rather dramatic opening of the story on "Windsor is falling apart" talking about the fellow who needed a job and then committed suicide did not augur well for our City.

The stories were not too favourable to the Mayor or the Development Commission when the Reporter wrote:

  • "There is a lot of sadness and anger around Windsor these days, despite talk from some city politicians that it's on the comeback trail...

  • Lack of industrial and political foresight have also cost the city."

  • He has floated the idea, unrealistic to many, of a program that would allow Windsor workers to commute to jobs in western Canada by air while keeping their homes and families in the city. Opposition politicians in the Ontario legislature used the idea as an example of the extent of Windsor's desperation.

    And some observers see it as just another example of city hall's ineffectiveness. Gerald Fedchun, president of the Automotive Parts Manufacturers Association and a Windsor native, says council can't seem to make much progress in moving the community forward. He describes it as "dysfunctional."

  • Critics of local leaders also point to a lack of attention to the Windsor Essex Development Commission, the local job-creation agency, until the past few years.

  • Farming around the city, a casino and additions to a cluster of top-notch post-secondary schools also helped diversification away from manufacturing.

    But it hasn't been nearly enough. And some critics say Windsor hasn't leveraged its auto advantages enough or put the necessary resources into economic development over the years.

It was very ironic when he wrote at the end of the Sudbury story:

  • "We have to live by not only what is beneath our feet but also what is between our ears."

Isn't that very similar to the line that Eddie's nemesis, Dennis DesRosiers, uses all the time when he quotes the former Chrysler president when talking about the new R&D jobs in the auto industry.

Detroit Council Saves Windsor



Keep your fingers crossed. The Tunnel deal may be dead! Finally.

Its end will come none too soon as far as I'm concerned given all the secrecy involved.

There was absolutely no need for this behind closed-door intrigue if the deal made sense for taxpayers on both sides of the river.

It looks like Windsorites may owe a big debt of gratitude to members of the Detroit Council. They may have saved us from another Francis folly, the $75 million transaction with the Tunnel.

You may not have seen the recent headlines in Detroit but they are certainly good news for Windsor taxpayers who are already struggling with the downturn in our economy:

  • "Mayor Kwame Kilpatrick's proposal to sell Detroit's half of the Detroit-Windsor Tunnel as a stopgap budget fix was all but declared dead for this fiscal year Friday by the City Council."

  • "Council doubtful of proposal to sell tunnel"

  • "Detroit nearly throws out tunnel proposal"

You have to shake your head in amazement when you read something like the following that frankly makes no sense to me whatsoever but I am sure that there must be a legal justification for it:

  • "In other budget work, Mayor Kwame Kilpatrick submitted a revised proposal to sell the city's half of the Detroit-Windsor Tunnel for $75 million as a way to balance the 2007-08 budget. The deal appears to no longer rely legally on using an existing agreement between Detroit and Windsor to recognize each other's bus fares as part of the foundation of the tunnel sale."

That seems so convoluted, it is almost ridiculous. Bus fares as the basis of support for a Tunnel deal! Remarkable.

Was this Press Release and announcement back in October 2006 nothing but a phony to hide some kind of transaction necessary for the Tunnel deal:

  • "October 24, 2006 (Detroit) SMART has partnered with DDOT and Transit Windsor to develop a single transfer system that bus passengers traveling between Detroit and Windsor can now use. In the past, customers traveling between the two countries could not use transfers between the different systems."

If so, is there any other conclusion but that politicians on both sides of the river have no respect for their taxpayers!

I really wonder if there was a Tunnel deal in the first place. The reason I ask this question is that I have never understood, if this deal is so good for both sides, Windsor and Detroit, then why haven't the Mayors of the two cities chosen to tell us what the transaction is? What's the big secret?

I cannot believe that the PR machines of both Mayors would not have turned out Press Release after Press Release showing us how wonderful the deal is and how much each side would make on this transaction to justify it. I don't recall really anything on our side telling us why it was a good deal for Windsor although on the Detroit side it was designed to fix a budgetary problem. I also do recall reading the warnings being used when it looked like Detroit Council might turn it down

  • "Deputy Mayor Anthony Adams repeatedly told council members Monday that the $65- million deal to sell Detroit's half of the tunnel would allow the city to end with a balanced budget. If the deal is not approved by the end of the fiscal year June 30, Adams has warned, the city would have to make drastic cuts in services and lay off workers."

The deal almost seems like it changes daily. I can understand that it is complicated because it is a cross-border deal but surely after a year of negotiations the parties should have been able to arrive at a structure by now that is workable. After all, we in Windsor has spent over $1 million so far on outside fees for this project. That it keeps changing so often tells me that there are severe problems involved, problems that the Councils on both sides have no idea what they are, never mind the taxpayers.

Here's one thing that I find very disturbing about our Council and how they do business, or rather do NOT do it. Take a look at some of the things that Detroit Councillors are saying:

  • "I do not see this thing getting approved as a component of this budget,"
  • "I just don't see how the deal is going to take place," she said. "I'm not a person that's in support of onetime fixes, and I think it's a onetime plug in the budget."
  • Councilwoman JoAnn Watson said she opposes selling something as singular as an international crossing for $75 million. "Does that sound like a good deal to you?" she said. "No. Hell no."
As for our Councillors, sure they have talked about the deal in general including Councillor Marra saying this
  • "My concern is not legal finds, but ultimately is this decision favourable for the taxpayer. What looked good eight months ago might not be good today."
After that comment, I hear that certain people went ballistic and this became Council's new mantra
  • "Coun. Bill Marra, a member of the city tunnel commission, said councillors have been asked to refrain from commenting until the negotiations are complete."

I have never heard anything as absurd as this. The Councillors are being told in effect that they cannot perform their legal duty. Their continued silence suggests that they are going along with it.

Why the only other thing that I can recall that is comparable is the Councillors approving the arena deal with the Spitfires without looking at the agreement so that they had no real idea what they were approving:

  • "City council approved the agreement with the Spits in the fall of 2006, but councillors themselves were not shown copies of the deal. Council endorsed it based on an administration report that was then taken away following in-camera discussions.

    "I couldn't tell you what's in there," said Ward 5 Coun. Percy Hatfield, one of several councillors who will be seeing details of the multimillion-dollar deal for the first time this week. "

Why it almost seems that Councillor Hatfield has no shame that he is ignorant of the terms of that deal that will cost us $64 plus million dollars and more by the time it is finished.

The other person who has to be very happy at this time is Minister of Finance Dwight Duncan. How he would have justified a loan in effect to the City of Detroit in the amount of $75 million when Ontario is suffering itself is beyond my comprehension. That it should have been even considered for one second is a disgrace. It should have been rejected right out of hand by the Ontario Government.

I can hardly wait for the finger-pointing to see who gets the blame:

  • Will it be our Mayor because he was incapable of getting financing necessary for the project?
  • Will it be the Federal Government for pulling out and not financing the transaction?
  • Will it be the Detroit Councillors who are not willing to cooperate with the Detroit Mayor notwithstanding his text message difficulties?
  • Will it be the Mayor of Detroit who kept this deal alive forever when it seemed to have no possibility of ever closing and who seems to have lost the trust and confidence of his Council so that no deal could ever be done?

Actually, I expect that the Bloggers in town will be blamed for the collapse. Why not, we are blamed for everything else that is negative.

It won't bother me one bit to accept the blame. If the Mayors can't tell taxpayers why this deal makes sense, then there is no reason to consider it any further.

Tunnel Deal: R.I.P