Thoughts and Opinions On Today's Important Issues

Thursday, January 28, 2010

Canada's Dubai Ports Controversy (PART II)

The Detroit/Windsor border file cannot get any more ridiculous can it?

Oh no, then take a look at this new story coming out of Transport Canada. The Harper Government is hell-bent to destroy our relationship with the Americans.

I am sure that you remember what the Dubai Ports controversy was all about: whether the sale of port management businesses in six major US seaports to a foreign country would be a national security interest concern.

Is the US going to face this again if Canada takes over the Ambassador Bridge? (Forget about a DRIC bridge ever being built. It is delayed so long now). Throw in Windsor's attempt to take over the Detroit/Windsor Tunnel, the possible sale of the Blue Water Bridge and the fun and games in Fort Erie and all of a sudden the Americans lose control of key border crossings in Central North America.

Isn't that what "shared border management" really is all about with the Customs facilities for both sides generously located on the Canadian side? Isn't this why Prime Minister Harper is the key person involved for Canada on this file (mere Ministers for the Atlantic and Pacific gateways) and why he has raised the Ambassador Bridge issue at least three times with two US Presidents?

I raise the issue again because of an interesting comment made by Mark Butler, the spokesperson for Transport Canada:
  • "Windsor-Detroit border crossing project ready to proceed
    Environmental assessment approval sets stage for land acquisition, talks with U.S.

    ...the Canadian government is poised to proceed with the next steps in development of a new border crossing between Windsor and Detroit.

    These include continued land acquisition on the Canadian side and discussions with the government’s U.S. partners on procurement of the six-lane international bridge.

    “We are continuing our discussions with Michigan on governance issues and financing issues,” said Mark Butler, a Windsor-based spokesman for Transport Canada...

    Butler said the Canadian government would prefer that the new cable-stayed or suspension bridge be undertaken on the basis of a public-private partnership. But he said this approach is not yet set in stone.

    “One of the reasons is that the U.S. side of the bridge would be owned by the state of Michigan. But the state does not have P3 legislation in effect. Until that legislation is passed, Michigan would not be able to enter into a P3 agreement.”

    Once that legislation is enacted, a decision would have to be made on whether the public-private partnership would include the inspection plazas or just the bridge.

    Essentially, once a decision has been made and Michigan has the legislative authority to go ahead with a P3, we could then be able to go out to the marketplace and issue requests for qualifications,” Butler said...

    While the Canadian government is anxious to break ground “as soon as possible,” a construction start date has not been set.

    “I can’t crystal-ball this,” Butler said. “What we do know is that it is probably going to take 48 to 52 months to build the bridge, whether it is cable-stayed or suspension.”

In passing, years of debate to get P3 legislation in Michigan, if it ever comes, and then doing an RFP and 4-5 years for bridge construction means we will not see a new DRIC bridge until around 2020 at the earliest. An Enhancement Project bridge could be operating at around 30 months after all approvals are given. And Governor Granholm has blamed Canada for the delay.

What though is the most interesting aspect is that there may be a backing off from a P3 project. Right now, unless there are government guarantees or subsidies, no one would bid on a P3 bridge. Tolls alone could not pay for the new DRIC project.

The lack of money in the marketplace and the fierce competition from the Bridge Company whose tolls would be substantially less would mean bankruptcy for a new DRIC crossing.

No wonder Butler said:

  • "the Canadian government would prefer that the new cable-stayed or suspension bridge be undertaken on the basis of a public-private partnership. But he said this approach is not yet set in stone."

He knows that Michigan with its Senate and perhaps a new Governor might never pass P3 legisaltion.

A P3 with an investor "friendly" to Canada as the one who controlled the DRIC bridge and the Blue Water Bridge, just like Windsor would have been a "friendly" Tunnel operator, gives Canada exactly what it wants without Canada appearing to be the "owner" of the border crossings! It would not get anyone in Congres all excited.

If P3s are dead, then what is the alternative? There is little money in Michigan to pay for it and the NAFTA-gate President is not going to spend billions on a not neded bridge when he is concerned with health-care, the economy and two wars.

Therefore, Canda has to spend some dollars. It is after all a 50 year Canadian effort to take over the Ambasssador Bridge. To date, the only money the Feds have set aside is part of the money for a DRIC Road. There is no allocation specifically for a DRIC bridge or buying the Ambassador Bridge.

Do not foget what the President via the State Department has already said about a new DRIC crossing and the granting of a Presidential Permit:

If Canada ever publicly says that money is going to be set aside to construct a DRIC bridge, remember you read it first here: Dubai Ports #2!