Thoughts and Opinions On Today's Important Issues

Tuesday, June 01, 2010

Michigan House P3 Bill

Wow, can the Michigan traditional media be that dumb or is there some other explanation for their failure to report the P3 story properly?

Since none of the major Michigan traditional media outlets have seen fit to go through an analysis of the House P3 Bill, then the BLOGMeister will do it, clause by clause! Instead of vilification, those legislators who are opposed to the P3 Bill should be congratulated as taxpayer heroes.

Someone needs to let the public in on the secret. The P3 Bill sucks. What the Bill says and what we are being told are two completely different things.

THIS BILL CLEARLY STATES THAT MICHIGAN TAXPAYERS CAN BE AT RISK FOR THE DRIC BRIDGE.

Keep on reading and I will prove it conclusively to you!

You see, dear reader, any of the House Republicans and House Democrats who voted against the Bill and any Senator who dares vote aginst the Bill must be scum since they are, in the words of the Detroit Free Press Editorial writers
  • "The remaining legislative holdouts are simply shilling for a billionaire fighting to maintain his monopoly at the busiest border crossing between the U.S. and Canada."

It seems as if the Editorial writers also have blinkers on since they must think that a new bridge built by the Bridge Company won't need workers, only a DRIC bridge will:

  • "Legislators who obstruct the crossing -- which will create thousands of good jobs and generate millions of dollars of economic development without exposing Michigan taxpayers to new liabilities -- will have a hard time explaining themselves if their opposition scuttles this critical project."

All they need to say is build the Ambassador Bridge Company bridge that really won't cost the taxpayers a penny and where the risk of the traffic projections is borne by the private sector. Let the opponents of that bridge take the rap.

Nice language huh--shills, obstructionists--when legislators are concerned about:

  • legislative oversight
  • giving absolute power to unelected bureaucrats
  • signing a blank check to Caanda who would become an "Instrumentality of Government" of Michigan with all the power that entails
  • allowing complete power in the MDOT Director to condemn property
  • possible taxpayer risk since P3 proponents want availability payments since toll revenues won't cut it and when the MDOT Director finally admits in the Free Press that Canadian and Michigan taxpayers have to pay out money on DRIC "But Steudle points out that much of that $5 billion won't be recaptured by tolls, including connections on the Detroit side and about $3 billion that Canadians will pay for the several miles of highway connecting the DRIC to the 401."

I am shocked that the Free Press Editorialists did not suggest that all of those legislators were on Moroun's payroll too. Oh it does not matter if they ever received a penny from him or not. Here is how one commentator did it to a Michigan Senator:

  • "is a new bridge certain?

    Well, maybe not. Two men stand in the way.

    One is, not surprisingly, Moroun, a reclusive, 82-year-old billionaire who has been savagely fighting any new bridge, using methods both legal and, according to the courts, illegal.

    His motives are clear: preserving his monopoly. What motivates the other enemy of a new bridge is more baffling, however.

    He is [Name of Senator], whose [Name of] district is far removed from the Ambassador Bridge and the Detroit River.

    Matty Moroun has been known to contribute heavily to the campaigns of politicians he wants to influence, but it isn’t clear that he has been a big donor to [Name of Senator]."

Neat approach huh. KAPOW, slam the politician whether he opposes based on principle or not. Call him/her an "enemy."

How about this from the same fellow. It's even better and attacks everyone with one blow:

  • "But Moroun isn’t giving up the fight. He figures Job One is stopping the competition.

    Accordingly, he continues to oppose DRIC. He donates lavishly to political campaigns, and whether for this or other reasons, he has strong supporters in the legislature still trying to stop the new bridge."

My gosh, how can there possibly be any other reason?

These politicians should learn. Take a page from the book of Representative Gonzales as an example who was one of the big backers of the P3 Bill. No one goes after him. No one cares that he took donations from: It's OK to take money from backers of DRIC just like it is OK for so-called consultants of DRIC who I thought were to be impartial to advocate for DRIC in paid advertisements.

Hush now....there can be no double-standard if it is action for a "PUBLIC" bridge.

Here are some comments I made about the P3 Bill that the Senators may want to consider. http://www.scribd.com/doc/32230285/Michigan-s-House-P3-Bill

Guess the number of times I used "Complete discretion in MDOT to determine."



It was only 38 times.

I hope that the Legislators understand this. When it comes to protecting the interests of taxpayers or the pocket-books of P3 operators, the Detroit Free Press clearly is on the side of the Wall Street bankers and their fees and the P3 operators' obscene profits.

  • "Third, opponents argue that legislation authorizing a public-private partnership to build the second crossing amounts to a power grab by the Michigan Department of Transportation. But that argument relies on the dubious claim that legislators are more qualified to oversee such projects than transportation professionals. In fact, ceding the power for individual projects to the Legislature would be a disaster. It would inject way too much politics into transportation policy. In any public-private partnership, policy control will -- and should -- remain with the public sector.

    Even so, compromise legislation could give legislators some control over individual tolling projects -- if such power were exercised early. Investors would not put up millions of dollars for a proposal, including traffic studies, for a public-private partnership if they believed the Legislature would simply kill the project for political reasons."

Yes, so messy are "politics" and the "public interest.

Yes, let's have the pros at MDOT who screwed up the plaza at the Blue Water Bridge that will cost a half a billion taxpayer dollars to fix, look after P3s too. Yup, the same people whose traffic projections have been completely over-optimistic. Yessiree, those MDOT folks who are hiding the revenue projections from Legislators because they don't want them to know that toll revenues won't cut it. Yes the people who buried this provision in the Bill that should tell you that Michigan taxpayers will be screwed:

  • "(14) FOR ANY INTERNATIONAL BRIDGE CROSSING THAT DOES NOT EXIST AS OF THE EFFECTIVE DATE OF THE AMENDATORY ACT THAT ADDED THIS SECTION, A PUBLIC-PRIVATE AGREEMENT FOR ANY SUCH INTERNATIONAL BRIDGE CROSSING SHALL INCLUDE RISK ALLOCATION PROVISIONS SPECIFYING THE RISK ASSUMED BY THE CONCESSIONAIRE AND EACH INSTRUMENTALITY OF GOVERNMENT THAT IS PARTY TO THE PUBLIC-PRIVATE AGREEMENT RELATED TO THE PUBLIC TRANSPORTATION FACILITY, INCLUDING THE RISK RELATING TO CONSTRUCTION COST OVERRUNS AND, AS APPLICABLE, TOLL REVENUE SHORTFALLS.

    BEFORE APPROVING AND ENTERING A PUBLIC-PRIVATE AGREEMENT FOR ANY INTERNATIONAL BRIDGE THAT DOES NOT EXIST AS OF THE EFFECTIVE DATE OF THE AMENDATORY ACT THAT ADDED THIS SECTION, THE DEPARTMENT SHALL ENSURE THESE RISK ALLOCATION PROVISIONS PROVIDE FOR THE MOST ECONOMICALLY BENEFICIAL WAY FOR THIS STATE TO PERFORM THE PROJECT, WHILE MINIMIZING LIABILITY FOR CONSTRUCTION COST OVERRUNS AND TOLL REVENUE SHORTFALLS FOR WHICH THIS STATE COULD BE HELD LIABLE, AND THE DEPARTMENT SHALL SUBMIT A REPORT TO THE GOVERNOR EXPLAINING HOW THIS MANDATE WAS FULFILLED."

Huh, what is going on here. Shortfalls, revenue shortfalls, FOR WHICH THIS STATE COULD BE HELD LIABLE, how they will be minimized...I thought this was a riskless, no-brainer for the State. Now that seems to be a lie if I am reading this correctly.

It appears as if MDOT is anticipating a toll revenue shortfall as the P3 RFPOI proponents suggested and here come “availability payments” where taxpayers foot the bill!!! And how do they get off the hook for "oversight?" Merely have the Governor appointed Director reporting to the Governor with NO RPEORT TO THE LEGISLATURE!

How could this possibly happen you may think with Canada's riskless $550M? Simple, due diligence considerations result in unresolved differences can mean that a deal cannot be made with Canada for the $550M. However, since the P3 legislation has been passed, Canada and MDOT can make whatever deal they want even if there is a revenue shortfall that taxpayers have to make up.

It's really that easy. Why it's brainless.

Does not give me a whole bunch of confidence. I wonder how the Free Press Editors feel.