To hear MDOT talk, the proposed Detroit River International Crossing (DRIC) is not so much a bridge as a yellow brick road to eternal prosperity. This image appeals to your Wizard, of course, but I am more concerned about whether the image is based in reality or merely the result of a bump on the head. Why the DRIC instead of a private second span put up by the Ambassador Bridge (AB) people?
The case for DRIC goes something like this: (1) we need a second bridge to accommodate the tremendous growth in traffic we will see in the future, (2) the good witch of the north (Canada, for those of you not following my Oz analogy) has offered us a $550 million loan to get started, and (3) we can turn that $550 million into another $2 billion from the federal government to put toward our roads. Ultimately, the DRIC is supposed to generate thousands and thousands of jobs and enable our manufacturing and agriculture industries to thrive. The Canadian loan, the cost of the project, and all future costs would be paid or repaid out of bridge tolls.
Let's set aside the "jobs" and "thriving industries" justifications for now. Whether the bridge is built through a public-private partnership or by the AB folks, those benefits should still accrue, so those justifications favor neither approach. And, if we need a second bridge, we need a second bridge, regardless of who builds it.
So, based solely on media coverage (a dicey proposition, I know), the case for DRIC appears to boil down to the fact that Canada has offered its loan for a public bridge, and we can use that loan to leverage federal highway funds. Let's look at these issues in some more detail:
Investments by the AB people generate what are called "toll credits" that can be used to leverage federal highway funds. Has this been done? How much is available? Would the cost of a new, private bridge be a basis for further federal matching funds? I have heard that anywhere from $250-500 million is available right now and, based on the 4-to-1 ratio used by MDOT and the feds, would generate $1-2 billion, but these credits are not being utilized. If so, why not? Is the MDOT downplaying that option in order to make the Canadian loan appear more attractive?
Will a public bridge truly be self-sustaining in terms of cost and annual maintenance? If we build a $3 billion public bridge and budget 2 percent for annual maintenance, that's $60 million per year. Will the tolls really cover that and the loan to Canada and the repayment of the bonds used to finance the construction? What if they don't? In 2009, 6.5 million cars and trucks went across the Ambassador Bridge. Let's say that traffic gets split evenly between the AB and the DRIC. With 3.25 million vehicles, the DRIC would have to charge a toll of $18.46 just for maintenance, and much more to repay Canada and the bondholders. Is that competitive?
We need to examine MDOT's traffic projections carefully. According to the Bridge and Tunnel Operators Association, actual traffic across the AB has declined over 47 percent since 1999. During that same period, Detroit-Windsor Tunnel traffic is down over 58 percent, and Blue Water Bridge traffic is down over 19 percent.
The ramps and plazas for the second AB span are already in, and I understand that it will take about $500 million to finish the job -- all private money, with no taxpayer risk. Why isn't this a better option?
Look, I'm the first to point out that it's Wizard of Laws, not Wizard of Transportation or Accounting. But before we rush into a public-private "partnership" built on a loan from another country, shouldn't we have the answers to some of these questions?
