$1B Windsor-Detroit bridge deal struck
A saga that former prime minister Jean Chrétien started in 2002 takes a major step forward
A deal has been struck to build a new Canadian-financed bridge linking Detroit and Windsor, Ont., a move that government and business interests say will generate jobs and economic growth.
Canadian Prime Minister Stephen Harper and Michigan Gov. Rick Snyder jointly made the announcement on both sides of the Detroit River, which separates the two cities by less than a kilometre.
"I do a lot of announcements, but this is a really big one," Harper said after a nearly one-minute ovation that followed the announcement.
Under the agreement, Michigan wouldn't be obligated to pay any of the anticipated $1-billion cost of the bridge.
A Canadian entity would handle design, construction and operation of the new span, which will connect Windsor’s west end to the Delray community in Detroit.
Also under the agreement:
- Ottawa will make annual "availability payments" to fund the design and construction of the crossing as well as for the operation and maintenance expenses during the terms of the public-private partnership agreement.
- No tolls will be charged in Michigan for use of the bridge. Canada will charge tolls, which will be used to reimburse the Canadian government for the funds it spent to build the span.
- Canada will pay all costs of the required land acquisition in Canada and Michigan. It also will pay to construct an interchange to connect the crossing to I-75.
- The public-private partnership agreement and the request for proposals must contain provisions for community benefit plans and for the involvement affected communities in Michigan and Canada.
"Our government is taking the measures necessary to facilitate trade and investment between Canada and the United States in order to generate jobs, economic growth and long-term prosperity," the prime minister said in a media release before the announcement. "This new bridge will reduce congestion at this critical Canada-U.S. border crossing, support the creation of new export-related jobs and investment opportunities along the Quebec City-Windsor corridor, increase the competitiveness of the North American manufacturing sector, and provide thousands of construction jobs in Ontario and Michigan."
Officials want the bridge complete by 2018.
Harper called the bridge "truly visionary" and a "celebration of friendship" between Canada and the U.S.
"For it was 200 years ago this month that the War of 1812, the last armed conflict between our countries, was declared. Indeed, the first shots were fired right here in the Detroit-Windsor region," Harper said. "It took three years to bring peace back to the Detroit River and when it came, no one thought it would be for long. But it endured.
"Our two great countries, Canada and the United States, became the best of friends, indeed, arguably the most intimate and successful international friendship in human history."
Snyder also praised the friendship between the countries.
"That’s what friendship is all about; stepping up and helping someone," Snyder said. "A special note of thanks to Canada, for your generosity and thoughtfulness in this project."
Critical trade corridor
The Windsor-Detroit border is the busiest in North America.
In 2010, it was reported that 28,814 trucks crossed the privately owned Ambassador Bridge on a daily basis. It is the busiest border crossing in North America.
According to the Ambassador Bridge, more than 25 per cent of all merchandise trade between the U.S. and Canada crosses that span. Almost $500 million US in trade and an average of 10,000 commercial vehicles pass daily over the Ambassador Bridge.
"It's trade and increased trade that sets the context for what we're doing here today," Harper said.
Ontario Premier Dalton McGuinty was also on hand. He said the new bridge is important to the province's manufacturing sector, especially the auto industry.
According to Chrysler, which builds minivans in Windsor, the company moves more than 1,300 component shipments and 2,000 cars and trucks across the Windsor-Detroit border. Each day, Chrysler makes more than 1,600 customs entries.
"A new crossing represents a tremendous opportunity to further strengthen the economies of the U.S. and Canada, the future of our company and many other businesses," Chrysler CEO Sergio Marchionne said in a statement Friday.
Bridge to create jobs
A study by the Center for Automotive Research projects construction of a new international crossing between Windsor and Detroit will create thousands of jobs for southeast Michigan.
According to the study, approximately 6,000 jobs will be created in each of the first two years of construction of the bridge. An additional 5,100 jobs will be created in each of the final two years of construction.
The study does not look at potential jobs in Windsor.
"It doesn't mean that jobs won't be created in Ontario as well. And it could be similar type numbers because you're obviously building the bridge from that side," said Kim Hill from the centre.
In addition to the new construction work, Hill said the new jobs will include everything from health care to engineering.
The project includes the bridge, Canadian and U.S. inspection plazas, and an interchange with Interstate-75, with construction expected to take four to five years.
The project will be funded by the Canadian government, with the U.S. plaza falling under the responsibility of the U.S. government.
The private sector is also expected to contribute to the project through a public-private partnership. Ontario and Canada are jointly funding the Windsor Essex Parkway, which will connect Highway 401 to the new bridge.
"This agreement is about more than building a bridge," Snyder said in a release issued before the event. "It’s about building a future of economic strength and security for families across our entire state."
Windsor Mayor Eddie Francis said Friday was a historic day for Windsor, Canada and the U.S.
"Not only does it create jobs in terms of the jobs that are needed to build the facility but the jobs that will be supporting the industries that depend on a crossing, that depend on the supply chain working, and that's all very positive," Francis said.
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The new bridge is something Harper's two predecessors could not accomplish.
In 2002, Jean Chrétien announced $300 million for a new bridge but it never got off the ground.
Two years later, Chrétien's successor, Paul Martin, vowed to "fix the border" during his term as prime minister. He didn't.
In 2010, former Michigan governor James Blanchard alleged Ottawa offered to buy the Ambassador Bridge from billionaire Manuel (Matty) Moroun in 2009. Talks supposedly broke down when Moroun asked for $3 billion plus incentives.
Earlier this year, Harper called it "ludicrous" that a border crossing could be privately owned. Moroun responded by asking him to meet and come up with a resolution.
New bridge has opposition
Some Michigan residents say the decision on a new bridge should be put to a vote.
The People Should Decide is a statewide initiative that wants government proposals to build additional international crossings to first be approved by the voters.
"Whether a government bridge will ever be built, it is the people who should decide," the group's director, Mickey Blashfield, said in release early Friday. "Beyond a press event, the governor needs to make his best case for his government bridge.
The Michigan legislature, after reviewing all the facts, was not convinced.We believe the people want and deserve to have a vote about such an important issue."
Earlier this week, in the Michigan legislature, the House appropriations committee amended a funding bill, barring the Michigan Economic Development Corporation from spending taxpayer money on construction of the new international crossing.
Hours before the announcement was even made, Snyder took to his Facebook page to defend the decision.
"Detroit is the busiest commercial border crossing in North America. Some 8,000 trucks cross the bridge into Canada each day, and all of that trade supports 257,000 jobs across Michigan. But unless we act now, those jobs could be in jeopardy because of our total dependence on the 83-year-old Ambassador Bridge as the primary point of entry into our neighbour to the north," Snyder posted.
Moroun has declined to comment on the new agreement.