Michigan DOT/Canadians probing interest in concession/P3 on new Detroit River Bridge

Michigan DOT (MDOT) and the federal Transport Canada are requesting for expressions of interest  (RFEOI) in some kind of toll concession or partnership with the private sector in building a new toll bridge over the Detroit River a couple of miles downriver of the Ambassador Bridge. The project called the Detroit River International Crossing (DRIC) has been developed by a foursome of federal and state/provincial government transport departments on both sides of the border.

Planning and permitting of the project including its connections on both sides of the river - the international border - is complete. The FHWA issued a 'record of decision over a year ago and Canadian permitting is also complete.

The project has been in development since January 2005.

The bridge and approaches of 6 lanes would provide an expressway standard and more direct connection between I-75 in Detroit and the Highway 401 expressway in Windsor, the main drag to Toronto and beyond.

The privately owned 80 year old 4-lane Ambassador Bridge in Detroit has decent connections on the Detorit side but terrible connections on the Canadian side - 11.7km (7.3 miles) on city surface streets to get to the H401.

The request for expressions of interest for firms or teams has a submission deadline of March 17.

MDOT say the immediate need for comment is to "provide the Michigan Legislature and the Canadian government with more information to formulate governmental policy and develop a procurement and transaction schedule."

State transportation director Kirk Steudle is quoted: "At this point, we are considering a model that would incorporate some participation by the private sector in financing, design, construction, engineering and maintenance. Although we have not yet finalized what that model will eventually look like, we know there are a number of teams out there eagerly anticipating the start of work on this historic project that will create jobs and keep international trade flowing across the border as efficiently as possible."

The announcement also says "there are several public-private partnership models ranging from real tolls to availability payments that could be applied to the DRIC under current market conditions."

So far there has been no proposal for any joint powers public agency to finance operate and toll the bridge.

The actual Request for Proposal of Interest - a 27 page document see link at bottom - is written in terms of a toll concession being envisaged.

The bridge, it says, would be jointly owned by the Michigan and Canadian governments and the approaches by the respective government.

There may be a Canada-Michigan Joint Governing Entity (CMJGE), the request for expressions of interest says to set the terms and conditions  and oversee the procurement through to a concession. The CMJGE would continue formally in place to supervise and enforce the concessionaire's adherence to the terms of the concession.

The project is described as consisting of four elements:

1. I-75 interchange a 3-level trumpet including extensive relation and improvement to local streets and a NS/CSX rail line

2. US Border Inspection Plaza

3. Bridge itself of 2x3 lanes expandable to 2x4 lanes of cable stayed design with no piers in the water

4. Canadian Border Inspection Plaza and toll lanes

The access road on the Canadian side - an elaborate Windsor-Essex Parkway - is also fully permitted but will be financed and built separately from this procurement. An RFP has already gone out from Ontario Ministry of Transportation to three shortlisted firms for a design, build, finance and maintain contract for the Parkway.

The Parkway of 11km (6.8 miles) is to be a six lane expressway  with some 11 sections in cut and cover tunnel and the remainder depressed to minimize impacts.

Timetable

The RFEOI says the governments envisage a timetable:

- approvals by Michigan and Canadian governments this summer

- RFQ winter 2010-11

- RFP summer 2011

- bids winter 2011-12

- close on concession contract summer 2012

Estimated costs $2.26b

Estimated construction costs in 2009-US$s are

- I-75 interchange $451m

- US Plaza $474m

- Bridge $812m

- Canadian Plaza $523m

Total $2260m

Challenges

The project faces major challenges - economic and political.

For several years now traffic across the Detroit River has been in serious decline, a reversal of the prospects for growth seen when project development was initiated in 2004/5. Collapse of the Big Three carmakers with their heavy presence in Detroit and suppliers in Ontario was a large part of that. Now there is the financial bubble crisis and major recession depressing trade and tourist traffic.

It is unclear the project is presently financially viable and economically justified.

There is up-to-date traffic and revenue feasibility study.

At a minimum the project seems likely to require major government subsidy, and support for it from Michigan officials, and others may founder on that requirement.

The project faces determined political opposition from Manuel 'Matty' Moroun owner of the Ambassador bridge, a bare-knuckles political infighter who doesn't want the competition of another crossing, and spreads a lot of money around politicians in an attempt to stop the project.

Moroun proposes instead to twin the old suspension bridge with a new cable stayed 6 laner right alongside at a cost of nearly $1b, he says.

Moroun's proposal itself faces major obstacles also - notably his lack of any plan for a high quality connection to H401 on the Windsor side. The City of Windsor has so far flatly refused to consider Moroun's twinning plan. Canadian officials remain unbought - for now.

copy of request for expressions of interest:

http://www.tollroadsnews.com/sites/default/files/RFPOI.pdf

http://www.partnershipborderstudy.com/

TOLLROADSnews 2010-01-28