Tag: Tolls

While private enterprise for the most part has been able to hold costs and effects of inflation in check, in many cases through efficiencies and watchful management, government does no such thing.  An infrastructure operation that is run by government hasn't the same incentives, or mechanisms that allow increased costs to be aggregated along side found savings.  The Price will always go up. And the announcement of rate increases over one international bridge?

"The Sault Ste. Marie Bridge Authority (SSMBA) today reminded International Bridge customers of public hearings next week in Michigan and Ontario to review a proposed toll rate increase.

The proposed increase was prompted by the SSMBA Board of Directors' review on Aug. 15 of its long-range financial plan that details the operational and capital improvement project needs of the bridge for the next 30 years. The proposed toll increase (in U.S. dollars) includes an increase in passenger vehicle tolls from the current $3 per trip to $3.50 per trip on April 1, 2014, and from $3.50 to $4 on April 1, 2019."

The image below the line is just the first salvo from both sides of the bridge issue.

Its good to see the arguments made from the different perspectives. Plenty to be said about whether or not we actually pay for it in one way or another, but surprisingly no one yet doing what will ultimately provide the most accurate answer.

The math equation.

20,000 Crossings a day now.  Unless the Ambassador bridge is FORCED to close, then the traffic would split.

Average ticket of $6 Gross $120,000/day (if the ambassador is FORCED to close) $44 Million a year

Debt service (interest only) of $30 Million a year. Then add to this the cost of operations, ongoing liabilities (you know those pesky benefits) and maintenance.   An additional $30? $50 million? A year?  

My goodness So who DOES pay for it when it doesnt even pay its bond?  mmmm?

Dick Morris says Rick Snyder should act like a Republican, and in the process draws out the hard core "re-distributionists."  Darrell Dawsey writes at MLive:

Matty Moroun is rich enough. He doesn't need or deserve a second bridge. (Personally, I wish someone could take the first one from him, too.) Free enterprise is fine, but private citizens shouldn't be in the business of owning international border crossings. Our borders, and the economic and national security issues they generate, are a matter of public interest.

Snyder's wishes of another bridge makes perfect sense in some ways, and little in others.

He is a "Milliken Republican" which brings a brand of centrism that has too much in common with the Dawsey think, that government ought to have control of all things no matter how miserably they fail under government control. Detroit Schools? Detroit itself?  Perfect examples of Centrism allowing a minor scratch to develop into full blown gangrene.  Why not invite such catastrophe when given the opportunity?  Perhaps a little brick and mortar money poured into the patient's [amputation inviting] open sore infested hole will fix it?

Maybe such things need to be questioned a little more thoroughly.

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: