Ottawa wants to lend $550-million (U.S.) to Michigan as the Canadian government seeks support for building a new bridge along the continent's busiest commercial corridor, offering to help bail out a state ravaged by the auto sector's slump.
Federal Transport Minister John Baird said Thursday that Ottawa is extending a lifeline to Michigan to jump-start the $5.3-billion megaproject called the Detroit River International Crossing, or DRIC.
But Patrick Moran, corporate counsel for Manuel (Matty) Moroun, the 82-year-old transport tycoon who owns the Ambassador Bridge that spans the Detroit River, said Canada is taking advantage of cash-strapped Michigan's dire financial straits.
"Our state doesn't have two nickels to rub together and we have crumbling roads all over, and yet our state is getting involved in building a new bridge," Mr. Moroun said in an interview. "Michigan is hard up for cash."
The economic stakes are high - persistent bottlenecks on the Ambassador Bridge threaten to stall billions of dollars annually in trade. But Mr. Moroun accused Canada of encroaching on Michigan's turf, warning that Ottawa will favour Canadians over Michigan residents for bridge construction jobs, and hundreds of Detroit homes are in line to be bulldozed to clear the way for the new Detroit-Windsor bridge.
He said Michigan shouldn't be "selling out" its border to Canada when Mr. Moroun is willing to privately finance his own second span without dipping into the pockets of Canadian taxpayers.
Mr. Baird countered that the DRIC project is "the most important infrastructure project in the country," one that federal, provincial and state governments have been struggling to launch for a generation. If the Michigan legislature approves the funding, he said construction could begin within two years.
"One of the things we want to do is get those trucks off the streets of Windsor," Mr. Baird said in an interview, noting that truckers encounter 17 traffic lights along Windsor's main road leading to the Ambassador Bridge. "It clogs the entire city," he said. "We need a bridge at a better place."
The Detroit-Windsor region, battered by the recession and a prolonged slide in the auto industry, would benefit from thousands of construction jobs to be created by the DRIC project, located three kilometres southwest of the Ambassador Bridge.
Mr. Baird said the Canadian government expects to eventually recoup its loan of up to $550-million to Michigan by collecting a portion of the state's toll revenue from helping operate the new bridge.
The Ambassador Bridge has remained in private hands during its 80-year history. In 1979, Mr. Moroun saw a chance to cash in on what he believed would be increased trade between Canada and the United States. He gained full control after acquiring U.S. billionaire Warren Buffett's 25-per-cent interest in the bridge and smaller stakes from others.
After the terrorist attacks of Sept. 11, 2001, Ottawa took a keen interest in building a government-backed bridge, warning that if the Ambassador Bridge were allowed to be twinned, having two crossings so close together would make them easy targets for terrorists. Ottawa also wants any new crossing to be publicly controlled, instead of in the hands of a private citizen.
Thousands of commercial trucks and other vehicles cross Mr. Moroun's bridge every day, often wasting fuel and time due to frequent bottlenecks. Goods worth nearly $150-billion, or one-quarter of the annual merchandise trade between Canada and the United States, flow across the 2.3-kilometre span.
"Given the importance of this new crossing to the economic security and future prosperity of the United States and Canada, on behalf of the government of Canada, I am pleased to inform you that Canada is prepared to increase its financial participation in the DRIC project," Mr. Baird wrote in a letter sent Thursday to Michigan Democratic Governor Jennifer Granholm.
Gov. Granholm and the trucking industry praised Ottawa's push for a second bridge across the Detroit River because it will relieve truck congestion.
But Dan Stamper, a spokesman for the Ambassador Bridge, slammed the Canadian government's offer to lend money to Michigan. Mr. Stamper said governments in Canada and the United States should pave the way for Mr. Moroun to build his own privately run span, next to the Ambassador Bridge.
Mr. Stamper said Gov. Granholm will be making a huge mistake if she accepts funding from Canada. "Michigan Gov. Granholm, who is both a Canadian and an American citizen, has offered to sell the Michigan border to Canada," he said in a statement, raising concerns that Ottawa is plotting to create jobs for Canadians and reduce the U.S. state's benefits from new infrastructure. "Michigan is not and should not be for sale."
The DRIC team is comprised of the governments of Ontario, Canada, Michigan and United States. Private-sector participation is also planned for the construction, financing and operation of the new crossing.
Mr. Moroun has amassed major land stakes around the Ambassador Bridge and the proposed site for the government-backed DRIC project, positioning himself to delay or even thwart DRIC either through legal challenges or physical impediments on the ground.
Ambassador Bridge officials said they aren't aware of what Ottawa has previously offered to Michigan, though it's believed to have been a far cry from $550-million.
A government-backed crossing would include the new bridge, Canadian and U.S. inspection plazas, U.S. interchanges and other infrastructure leading to the Detroit-Windsor border, notably the proposed Windsor-Essex Parkway.
With a report from John Ibbitson in OttawaReport Typo/Error