BLOGExclusive: The Granholm Legacy--P3 Taxation

• "The latest overseas trip was Granholm's 10th since taking office in 2003."

I hope she will not be stopped at US Customs. Rumour has it that not only will the Governor bring back jet lag on her return but she will be carrying some strange stuff in her suitcase: the concept of P3s as a salvation for Michigan.

Oh it is serious, addicting many politicians world-wide it seems. Take a look at the BLOGs I wrote about P3 addiction if you want to know more about this fatal disease if not treated properly:
P3 Cocaine (Part 1) http://windsorcityon.blogspot.com/2008/11/p3-cocaine-part-1.html
P3 Cocaine (Part 2) http://windsorcityon.blogspot.com/2008/11/p3-cocaine-part-2.html

Of course, what that really means as Michigan Representative Pam Byrnes told us in her e-newsletter is a big rally on Friday for business, political and labour leaders to promote the passing of P3 legislation to save DRIC. Naturally, it won't be presented this way. The P3 umbrella will surround and hide DRIC to make P3s oh so appealling

Why Michigan leaders want to endrun President Obama by helping Canada out on DRIC has always mystified me. It cannot help the Governor if she wants a federal job. Take a look at my BLOG "Why MDOT Needs P3 Legislation For The DRIC Bridge"
http://windsorcityon.blogspot.com/2010/03/why-mdot-needs-p3-legislation-for-dric.html

P3s would serve a purpose for MDOT for sure and for Canada:

• 1) little legislative oversight over spending if the money is coming from the private sector (until payback time when it is too late)
  


• 2) a way perhaps to try to get around the eminent domain legisaltion
  


• 3) a way to avoid a Dubai Ports situation and having Congress intervene.

Let's cut the P3 BS.

It is nothing more than a financing tool that Wall Street is trying to sucker Governments to adopt to make bankers richer. After all, the fees are huge. With the economic melt-down, who needs the investment bankers when Governments can borrow money at cheaper rates than the private sector. Look at the mess Macquarie is in with their tollroads to see what happens when this concept sours.

• "Macquarie to split gems from dud pikes
  
  Macquarie are proposing to split their portfolio of pikes into the gems (called Mature MIG) and the duds called (called Active MIG). For the MMIG gems investors will pay a premium but will see the returns roll in steadily. The duds, Macquarie management will be working their tails off - active management - to make them less duddish. But being a more dicey investment AMIG the dud securities will probably sell at a lower price."

I do not understand why a State which can borrow money at low rates these days would want a P3 where the bankers want a monopoly and a rate of return from 13-20%!

I thought the rules about off-balance sheet borowings had changed so that a "loan" as a P3 deal really is has to be shown as one and not merely "expensed out" to make the State balance sheet look better.

If you want your hair to curl, take a look at this story about bankers and loans to Government. While not dealing specifically with P3s, if true, it is a scary read. Of course, I say, "if true" because I cannot vouch for its accuracy so you will have to read it with that caveat in mind:

• "Looting Main Street:
  
  How the nation's biggest banks are ripping off American cities with the same predatory deals that brought down Greece
  
  By Matt Taibbi http://www.informationclearinghouse.info/article25201.htm
  
  
  April 12, 2010 "Rolling Stone" - - If you want to know what life in the Third World is like, just ask Lisa Pack, an administrative assistant who works in the roads and transportation department in Jefferson County, Alabama. Pack got rudely introduced to life in post-crisis America last August, when word came down that she and 1,000 of her fellow public employees would have to take a little unpaid vacation for a while. The county, it turned out, was more than $5 billion in debt — meaning that courthouses, jails and sheriff's precincts had to be closed so that Wall Street banks could be paid."

Go to the top left of my BLOG and place the words "Port Mann Bridge" in the search box. You will learn the gory details of how the Macquarie P3 deal for a new bridge costing over $3B fell apart because of the economic melt-down and how the Province of British Columbia had to step in and save the deal.

More importantly, you will discover how the Province using the same contractors as the P3 group would save a billion dollars for taxpayers by financing the project the traditional way and shave a year off the project time-line.

A DRIC bridge financing would be a disaster since tolls would have to be up to 4 times higher than that of the Ambassador Bridge. Who would ever use it at that rate? Don't forget the bridge alone is over $2B and the entire project on both sides of the river is estimated at $5B. We know those numbers are not going to hold but will be much higher! Our Boston Big Dig by the time it is done.

Need proof of the financial failure to come---where are the financing numbers of the second section of the MDOT Wilbur Smith report and why hasn't MDOT revealed them BEFORE the rally!

If the tolls will really have to be that high, how can the new DRIC bridge compete? It cannot. Unless there is a subsidy to be provided by taxpayers, a new tax in other words for years to come for Michiganders. How many other bridge and road projects around the State will have to be postponed or cancelled to pay for DRIC? And that is exactly now being contemplated! As I Blogged before:

• " http://windsorcityon.blogspot.com/2010/01/why-did-canada-do-it.html
  
  "That is why separately Transport Canada's Mark Butler said:
  
  "We are continuing our discussions with Michigan on governance issues and financing issues,” said Mark Butler, a Windsor-based spokesman for Transport Canada...
  
  Butler said the Canadian government would prefer that the new cable-stayed or suspension bridge be undertaken on the basis of a public-private partnership. But he said this approach is not yet set in stone."
  
  Now you know why it is not set in stone. But it gets even worse:
  
  "Given the anticipated tolled nature of the border crossing, MDOT 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."
  
  What a joke...from real tolls to phony tolls ie payments support by either direct Government payments or guarantee or subsidies. All at extra taxpayer expense forever! They dare not say that in the RFPOI because then the Legislator who reads it would know that this is a financial disaster."

We are all being sold a bill of goods. Michigan especially now that we learned that the Canadian Prime Minister, Stephen Harper, really wants to be the owner after he issued his secret mandate letter to buy the Ambassador Bridge. The DRIC project was a phony, designed it appears to me to help him out in his fantasy.

I have Blogged before about the Danish Professor and his work on Mega-Projects. Here is another expert and what he has to say about these Mega-Projects as well:

• "Error and optimism bias in toll road traffic forecasts
  Robert Bain
  
  Abstract Traffic forecasts are employed in the toll road sector, inter alia, by private sector investors to gauge the bankability of candidate investment projects. Although much is written in the literature about the theory and practice of traffic forecasting, surprisingly little attention has been paid to the predictive accuracy of traffic forecasting models. This paper addresses that shortcoming by reporting the results from the largest study of toll road forecasting performance ever conducted. The author had access to commercial-in-confidence documentation released to project financiers and, over a 4-year period, compiled a database of predicted and actual traffic usage for over 100 international, privately financed toll road projects. The findings suggest that toll road traffic forecasts are characterised by large errors and considerable optimism bias."

In other words, P3s are a recipe for disaster. Why the Governor would want to be remembered for this is beyond me!

More Unanswered Questions About The Tunnel Deal

The US$75M Tunnel deal that Edgar (aka Eddie) tried to negotiate never made sense to me. We have never been shown a business case for it. We have never seen the appraisal for it which was the basis for our bid. Nor have we seen the letter in which Infrastructure Ontario offered some money for the financing of the deal but not all of it.



Let me quote more from Detroit Mayor Bing's Budget speech and you too will have to wonder if there is another story behind the Tunnel deal:



"The financial crisis inherited by this administration is by now familiar to all of you. An accumulated deficit of $330 million with no plan to reduce it...



Financial decisions were too often driven by politics, not sound fiscal policy.

Budgets were developed using smoke and mirrors, rather than data...



This budget ends the practice of using past budgets instead of actual cash needed to

determine funding for our operations...



Our citizens deserve to know the real numbers, without the phantom positions or the

fuzzy math. As a businessman, I expect a real budget with real numbers and a plan that

delivers real results..."



It was reported in the Press:



"Detroit City Councilman Kwame Kenyatta told the mayor that while pursuing low-hanging fruit was good, some high-hanging fruit weighs more.



It comes in the current-year budget, he said, included about $275 million in revenue that never materialized from items like monetizing income from the Detroit-Windsor Tunnel and the Municipal Parking Department.



Those items aren't in the 2010-11 budget, Bing said, adding that all revenues are “going south.”



The only thing the city can do in the short-term, he said, is make cuts.



“I don't want to base this budget on what I think is going to happen,” Bing said."



And this even stronger:



"Karen Dumas, Bing's communications director, said Bing will present an accurate budget to council today.



"Mayor Bing's first budget will be realistic in both its assessment and outlook. The numbers will be real," she said Friday. "No longer will the city be held captive by the political practices of shifting numbers, questionable projections and smoke-and-mirror tactics to create the illusion of a balanced budget."



And this:



"A report released last week by the non-profit Citizens Research Council suggested past administrations "dummied up" budgets to avoid making real and necessary cuts.



That practice is over, Bing said, while calling for the council to approve the budget by the start of the July 1 fiscal year and join him in restructuring city government and implementing needed changes."



And finally this:



"In 2009, then-Mayor Ken Cockrel Jr. presented a budget with $275 million in revenue from the sales of future income for the city’s parking and public lighting department and for selling to Windsor the city’s half of the Detroit-Windsor Tunnel. The latter sale was first introduced by ex-Mayor Kwame Kilpatrick in his 2008 budget.



Bing administration officials say the city’s current $3.6-billion budget is propped up with revenue presented in last year’s budget that never materialized, including the lighting, parking and tunnel deals. Casino revenues, property taxes and state revenue sharing are also less."



It sure does not look to me that Mayor Bing has put one penny in his revenues for a Tunnel deal:







Moreover, he has devalued the Tunnel to an amount significantly lower than Edgar's $75M if I am reading this chart properly:







As I Blogged before about the CRC ["The Tunnel Deal Questioned" http://windsorcityon.blogspot.com/2010/04/tunnel-deal-questioned.html]:



"the Citizens Research Council of Michigan, a nonprofit policy group, criticized him [interim Mayor Kenneth Cockrel Jr]for including several revenue assumptions, such as the sale of the Detroit-Windsor Tunnel and other departments that never materialized. The sale of the tunnel has been a budget-balancing fixture for years."



It said in its report:



"Discussions on the Detroit-Windsor Tunnel have occurred, but, even if an agreement were to be reached, the sale would not generate the amount included in the budget...



"Monetization is the process of converting assets into legal tender. The FY2010 City of Detroit budget includes $275 million in general fund revenues to be generated by the long term lease of Municipal Parking, Public Lighting, and Detroit’s 50 percent interest in the Detroit-Windsor Tunnel. This plan to sell the income from specific city operations or assets for a specific period of time was defined by the former mayor as “unlocking the value of city assets for citizens...



Probability. There may be progress on the sale of income from the city’s interest in the Detroit Windsor Tunnel this fiscal year, but the $275 million budgeted from monetization of assets appears to be a “plug” to balance the budget. [Bing's] Crisis Turnaround Team estimated that $225 million of the budgeted $275 million would not be realized in 2009-10.”



It is becoming clearer and clearer that the deal seems to be nothing more than "a “plug” to balance the budget" and "which he [Kwame] reportedly touted to rating agency analysts as key to gaining stable financial ground." That practice was carried on by the $100M valuation of the Tunnel deal by the Interim Mayor.



I will let the Americans figure out what the consequences are of "shifting numbers, questionable projections and smoke-and-mirror tactics to create the illusion of a balanced budget." Ratings analysts, people who loaned money to Detroit, those who did not seek payment or securitization and who may suffer a loss based on a balanced budget assumption would have very interesting remedies.



However, now that the wid4e-ranging scope of this is becoming apparent, it is time for Edgar to start answering questions and members of the Tunnel Commission and Council need to start asking them. Teh consequences coudl be severe for us as well dependign on what we learn.



It is not enough for Edgar to disclose information when it is convenient for him but he needs to do so when it is necessary for citizens!



As Mr. Sutts, the City's lawyer on the Tunnel deal said when dealing with the Kwame visit to Windsor:



"We feel it's necessary to put the record straight…



"We are not going to lie or appear that we are not being truthful. The facts are the facts -- and they can't change them."



So what are the unanswered questiosn for which we need teh facts:



1) WAS THE US HALF OF THE TUNNEL EVER WORTH US$75M



That should be an easy answer. Show us the appraisal report and the Infrastructure Ontario letter in which they agreed to loan an amount in a range of numbers, obviously less than $75M. Instead the Cit y has not released that data.



2) WHY IS EDGAR AFRAID TO SHOW US HIS "EXHAUSTIVE PROCESS"



Remember when Interim Mayor Cokcrel decided he wanted $100M for the Tunnel and Edgar went ballistic and threw a hissy fit:



"Mayor Eddie Francis questioned how Detroit arrived at a $100-million price tag for control of the U.S. side of the tunnel.



Windsor has gone through an "exhaustive process" to arrive last year at a $75-million value, he said.”



Simply put, I question how Edgar arrived at a $75-million price tag.



3) WHEN DID EDGAR REALIZE THE PROBLEMS AT THE TUNNEL



Again as Edgar said after the Cockrel $25M increase:



"That was the number we were prepared to pay back then, but economic conditions have changed considerably and are very different than five or six months ago.”



The mayor said 2010 toll revenues for the Detroit side are projected at about US$11.5 million, but the city has no way of knowing exactly since it is controlled by Alinda, a private company which holds a lease until 2020.



“Does the tunnel have revenues to support $100 million on the American side? I’d be interested in looking at their numbers,” Francis said



4)DID EDGAR EVER TAKE INTO ACCOUNT THE DRIC BRIDGE COMPETITION



I note that the Mayor did not talk about the 25% reduction that the Tunnel may face if there was a new DRIC bridge. If he did, then it might well mean that it made no sense to enter into this transaction in the first place.





5) DID THE MAYOR DO PROPER DUE DILIGENCE



Re the above, did the Mayor ever see Detroit numbers?



In effect, the Mayor did not know if the Tunnel was worth $100 million without looking at Detroit’s numbers. Yet, he must have had Detroit’s numbers if he was going to do the deal for $75 million. Those numbers would not have changed, only the cost to buy the Tunnel revenues would have increased by $25 million. It should have been easy enough for him to do the calculations. Was he telling us something however that is very serious. Surely after spending almost $2 million of taxpayer money on this transaction the Mayor is not telling us that he has not yet done the due diligence on Detroit’s numbers at all.



6) WHY WAS EDGAR PREPARED TO PAY $75M WHEN KWAME ONLY NEEDED $58M



""And that would only become necessary in the event that, once we do get the documents on the tunnel deal, if we do deem that it's not viable and it doesn't look good for the city of Detroit, we would vote that down and then be in a position to plug that $58 million that would be left in the budget," says Cockrel.



$58 million is what the Kilpatrick administration estimates the city would net from the $75 million deal after fees."



What did that difference of $17M represent? We have never seen an accounting for it.



How did the budget number change from $65M with a payment of $10M for fees and insurance out of the $75M initially to $7M less?







7) WHAT WAS THE ROLE OF DEREK MILLER



"Is Derek Miller, Kilpatrick's former CEO and now with Citivest, being paid directly or indirectly as one of the deal-makers?



This question is important since it was reported that:



"FBI investigates Detroit-Windsor tunnel player



A key player in the proposed $75-million Detroit-Windsor tunnel agreement, and a former aide of Detroit mayor Kwame Kilpatrick, is under investigation by the FBI as part of a federal corruption probe.



A friend of the mayor and his former chief administrative officer, Derrick Miller has been named in federal search warrants regarding his business dealings with a pair of Detroit businessmen, The Windsor Star reported today..



Miller was a lead negotiator for Detroit in talks with Windsor on the tunnel and helped establish the framework for the proposed deal — to create a joint tunnel authority.



“We’re shocked. We thought very highly of Derrick Miller,” said lawyer Cliff Sutts, Windsor’s lead negotiator on the tunnel talks.



“I honestly hope there is nothing inappropriate in his conduct that will cause him any future problem.”



Mayor Eddie Francis agreed, describing Miller as a key advocate on the other side of the border for keeping the tunnel under public control...



Miller left working for the City of Detroit in November to start his own consulting company, Citivest Capital Partners, but continued to play a role in the tunnel talks until the end of 2007.



The Detroit News and Detroit Free Press reported on Wednesday that court records revealed Miller is facing scrutiny in the escalating federal investigation into the city’s financial dealings."



8) IS EDGAR SMARTER THAN MATTY



Matty Moroun only bid $20M for a 100 year lease while Edgar is offering $75M upfront for a 75 year lease. Hw can ther be such a difference. Is Mayor Bing's number an indication that Edgar overbid?



The Federal Government was involved in this matter at one time but decided that they were not going to invest $75 million. what their number is we do not know but I suspect that it was substantially less. As I Blogged:



"The city has requested financial support from Transport Canada for the deal — given how the federal government also expressed strong fears about Moroun’s potential border crossing monopoly in Windsor.



“We have invited federal and provincial governments to participate and hope they will see the benefit of preserving the tunnel as a public asset and give us the legal and financial assistance we require,” Francis said.



Transport Canada is awaiting a formal proposal from the city on any funding support, said Mark Butler, spokesman for the federal ministry.



“Certainly there may be an opportunity for the government of Canada to be involved in the actual transaction,” he said."



However, Gord Henderson claimed in his column:



"Following that meeting, feelers were put out to the U.S. and Canadian governments about buying it. Ottawa and Washington weren't interested."

CUPE Elections

I believe that the elections for CUPE Local 82 are coming up soon.

I heard that Jim Wood, the President during the 101-day strike, is being challenged for the top job.

It will be interesting to see what happens.

Will the union members vote him out which would mean to me a repudiation of his leadership during the strike and afterwards, especially in relation to garbage outsourcing? Or will he remain at the helm of the Union either because the members liked his leadership or don't like his opponent.

If he loses, what would that mean to Jean Fox of CUPE Local 543 who has announced that she is running for re-election since she has a similar issue with her actions during the strike and with daycare closing.

The results of the election could also have an impact on relations with the City depending on the outcome and the platform of the winning candidate. Will we see a CUPE that is conciliatory or one that will become more militant.

The fundamental question in my opinion that Union members need to ask is whether they were well-served by their leadership during the strike and are they being well-served in the outsourcing debate and with other possible lay-offs at City Hall. In other words, how well has their leadership dealt with the public backlash against their members promoted primarily by the Star's one-sided support of the position of the hardliners on Council.

If there is a question period for candidates, I would ask why simple actions have not been taken that could have demonstrated why the hardliners "lost the war" contrary to what the Star said to re-establish the credibility of CUPE workers and why action has not been taken to stop outsourcing and closing in the face of obvious problems that the City has.

I have an opinion on what I would do if I was a CUPE member and have millions of reasons to support it. But since I am not, then I will keep quiet.

Can You Help Francis Kwame

I received this email, twice. Honest I did. I did NOT make it up. Francis Kwame was the name of the sender.

Someone overseas has a weird sense of humour

For a second, I thought it might be legitimate because of the reference to "Holiday to Bobo." Gee, I first thought it said "Boblo!"

Interestingly, another lawyer sent out an identical letter---Richard Agese. What a co-incidence.

However, something rotten is going on. Mr. Balino Harem, a third Attorney at law, also sent out a similar letter but his amount was $15M, not the $13M

SOMEONE HAS STOLEN $2m FROM THE ESTATE!

This deed must be dealt with immediately. I think I had better send out a mass mailing to millions of people world-wide asking for assistance and money to help track down the thieves.

• ----- Original Message -----
  From: Francis Kwame
  To: ..
  Sent: Tuesday, April 13, 2010 11:40 AM
  Subject: FROM MR FRANCIS KWAME CHAMBERS
  
  
  FROM MR FRANCIS KWAME CHAMBERS
  1515 CIRCLE GATE
  P.M.B 1076 OUAGADOUGOU BURKINA FASO.
  PRIVATE MEMO
  
  
  Dear Friend,
  
  I am Mr. Francis Kwame ,an Attorney at law, and the personal lawyer to Engineer Dr Alfred A. Corbeil, a foreigner who used to work and owned Corbeil Oil International in Burkina Faso, Herein after shall be referred to as my client.
  
  
  It may interest you to know that , I got your contact at the office of the Chamber of commerce and Tourism in Ouagadougou Burkina faso as I was going through some directories. On the 10th day of August 2003, my client, his wife and their two children were involved in a car accident along Ouaga - Bobo express way while arriving from a Holiday to Bobo.
  
  
  All occupants of the vehicle unfortunately lost their lives. Since then, I have made several enquiries to their embassy to locate any of their extended relatives and this has also proved unsuccessful. I am contacting you to assist in repatriating a fund valued at USD$13Million,(Thirteen million United States Dollars),left behind by my client before it gets confiscated or declared unserviceable by the Security Finance Firm where this huge amount were deposited. The said Security Finance Company has issued me a notice to provide the next of kin or have his account confiscated within the next twenty one official working days.
  
  
  Since I have been unsuccessful in locating the relatives for over 4 years now, I seek your consent to present you as the next of kin to the deceased so that the proceeds of this account can be paid to you. Therefore, I will not fail to inform you that this transaction is 100% risk free.
  
  
  On smooth conclusion of this transaction, you will be entitled to 30% of the total sum as gratification, while 10% will be set aside to take care of expenses that may arise during the time of transfer, internal revenue tax and also telephone bills, while 60% will be for me towards any profitable investment in your country. All I require from you is your honest co-operation to enable us see this transaction through.
  
  
  I guarantee that this will be executed under a legal framework and legitimate arrangement that will protect you from any breach of the law. I expect your urgent response indicating your full interest in this great business transaction to our both mutual trust.Please i advice you reply to my private e-mail address for privacy and confidentiality (franciskwame23@sify.com) Kindly give me the information below to enable me establish you in the bank as beneficiary to my deceased client.
  
  
  1. NAME IN FULL:.......................
  2. ADDRESS:..............................
  3. NATIONALITY:......................
  4. AGE:.....................................
  5. SEX........................................
  6. OCCUPATION:......................
  7. MARITAL STATUS:............
  8. PHONE..................................
  9. FAX:........................................
  
  Best regard,
  Francis Kwame Esq.
  

DRIC-Taqtaq-Dough

Hey everybody, forget Monopoly and having a space on the Board named after Windsor. Boring.

We need a distinctly Windsor take-off on a game to pass away the time at the unemployment office until our economy booms again. Something exciting but quick since we know that the attention span of Windsorites is low. That is why the Star publishes stories with the key points buried at the end so no one will read them.

The game has to be timely too so people will understand its significance. I figured that the game could be a take-off of Tic-tac-toe. Oh that game is NOT as simple as you think:

• "The simplicity of tic-tac-toe makes it ideal as a pedagogical tool for teaching the concepts of combinatorial game theory and the branch of artificial intelligence that deals with the searching of game trees."

Accordingly, I wanted a simple but fun game that is a good pedagogical tool for teaching the concepts of the border file settlement that was just reached. Thus in three words we learn everything as I name the game:

"DRIC-Taqtaq-Dough."

Do you understand. It explains that

1. we got a DRIC road settlement,
2. the Taqtaq family sees hopefully Duty Free Shop improvement as the Plaza gets fixed up (although under Edgar's leadership, Tunnel volumes are tanking so they may need a big rent reduction) and their lands around the Tunnel are expropriated finally and
3. Windsor gets dough for its projects, the $78M that Edgar negotiated with the Province.

Naturally we need to replace the X's and O's. So here is how it would look

OK, OK, I know I am being silly but surely not as silly as the sycophants whose vicious objections and opposition to the DRIC road disappeared as quickly as saying "Re-elect Edgar Francis For Mayor" when he got $78M extra. Health concerns, pollution and noise impacts and the effect on children simply vanished...poof...as if they never existed. Because they did not.

You have to admit though the three words do explain it all very concisely. Let me go into more detail. I have already Blogged about DRIC ("It's A Sell-Out") and the Dough ("The Price Of The DRIC Road Compromise"). Now let me talk about the third part.

$24.2 million dollars of Provincial money to help out an international border crossing, the Tunnel, owned by the City of Windsor. What a great use of Provincial money in a time of deficit. Does her Majesty's Loyal Opposition at Queen's Park know about this and approve it? Torontonians must be so proud of us that we get the money they are losing.

What a coup by our Mayor. I am shocked that the Star did not publicize it more. We all ought to be applauding it not seeing it hidden away by the traditional media. Come on guys, let us know more so we can praise the negotiating skills of our Leader.

Hmmmm, that's odd. I have not seen so far what I am going to tell you reported in the Star. Why not? Oh, I guess their reporters don't know any of this. It's all factual too just like the Bloggers Basher on CKLW wants. Were the following facts reported by the very well-trained journalists on the radio? Naw, I guess they did not know the facts either.

I really think that this is a gorgeous photo of our Mayor at the wedding of his obviously good friend, Abe Taqtaq.

In case you forgot, Abe's family runs the Duty Free Shop at the Tunnel Plaza location which is leased from Windsor taxpayers (I am not sure now if it is still the Windsor Tunnel Commission who is the landlord or the new Tunnel Corporation, both of which are headed up by the Mayor).

The Tunnel is the beneficiary of a huge contribution from the Province as part of Edgar's negotiated DRIC Road deal in case that part of the Edgar (aka Eddie) is our hero in the Star stories escaped you.

The Taqtaq family also is an owner of the plaza where the Mayor's spouse has her business. PCR, who built the new East End arena under a single source contract from the City, was also the contractor there I believe:

I mention this because of this startling declaration in a Tunnel Commission Minute. Surely it must be wrong. Surely she does not rent space at the Tunnel too but that is what it says:

All of this intense interest in the Tunnel on the Mayor's part to make it part of the DRIC Road deal. Think this is strange. Nope....It's hardly a surprise as you shall see. After all, the Tunnel is a City asset, right, and we have 5,000 commuters to protect no matter what the cost or so Edgar claimed before.

Let's see now. Here are some Tunnel facts that may interest you:

• the Tunnel has been described as a "unique security" risk
• the report on the shape of the Tunnel has never been made public (I guess Congressman Dingell still does not care about the safety of Tunnel users the way he did with Ambassador Bridge users, both crossings being about the same age)
• the Mayor wanted to spend $75M of Windsor taxpayer money--where it would come from, who knows--to take over running the US half do the Tunnel, not owning it either but failed miserably to do so at a cost of over a million dollars of taxpayer money in legal and consulting fees.
• the Tunnel no longer pays the City a dividend
• the Tunnel Plaza Improvement project was dead in the water since the City could not afford its $10M share and the price of the project had escalated dramatically as was told to us by the now departed Dev Tyagi
  
  (Current Project Status
  The first of three scheduled Public Information Centres on the proposed alternatives was held February 23, 2006. This is part of the Environmental Assessment (EA) process to allow the public to comment on possible alternatives for the improvement area. The second Public Information Centre was held July 26, 2006.
  Next Steps
  
  We are working with the City of Windsor to finalize the schedule for this project based on the remaining requirements for the EA study."
• the Tunnel traffic is falling dramatically: "Detroit-Windsor Tunnel - almost all cars and local - is doing horribly. Jan-Mar this year totaled only 886k v 1,050k Jan-Mar 2009, over 15% off."
• the DRIC Bridge is expected to take away a huge chunk of their business.
• The Provincial share of the project increased by 142% from $10M to $24.2M and its share of the total project increased from a one third share to 55% (Whatever happened to each of the Governments sharing equally?)

All of this interest and expenditure in a declining asset. Yet Edgar made it part of the DRIC Road deal.

Would it have been a deal-breaker if the Province said NO? I guess we will never know unless Sandra and Dwight tell us what they discussed over breakfast in Sandra's house. How charming. I wonder if there was any concern about the Members Integrity Act as Sandra made waffles and coffee for them.

Good to see that the Province and City want to become active participants in a NAFTA case!

So what is one of the big deal points on a settlement that is primarily concerned with the DRIC Road to the Ambassador Bridge (yes that is what will happen) and that takes up a good chunk of the $78M prize money that Edgar (aka Eddie) negotiated as a consolation prize for chickening out and putting Windsor at risk using his own and David Estrin's presentations as evidence:

• Building on the Let’s Get Windsor-Essex Moving (LGWEM) strategy
  
  Windsor-Detroit Tunnel Canadian Plaza Improvements
  • Ontario is investing an additional $10 million for improvements to the Windsor-Detroit Tunnel Canadian Plaza. This is in addition to the $10 million announced under the LGWEM strategy in 2004 and $4.2 million spent on property to date.
  • Ontario and Canada will immediately restart the environmental study.
  • Public consultation sessions will be held shortly leading to completion of the study and the necessary environmental report.
  • Subject to environmental approval, property acquisition, and completion of further engineering work, construction could start as early as winter 2011 and will take approximately one year to complete.

How terrific that it is getting started so soon just after Edgar turned the Tunnel into a private company where pesky taxpayers and reporters can be kicked out of Tunnel meetings just like at the airport.

$14.2M extra...making a $30M project now $44.2M. I am certain not all of that increase is due to construction cost escalation.

But wait, the City did not have $10M in its budget for its share....Where will that money come from? Perhaps from the sale of all of those City properties to the Province:

• "$12 million for the purchase of 150 city-owned properties along the route of the parkway"

Or maybe it will come from the obscene selling price that the Feds paid for the Brighton Beach property sold by Edgar.

Oh well, at least the Taqtaq family can breathe a big sigh of relief. They run the Duty Free Shop. The Star also claimed several years ago that they owned a lot of land around the Tunnel. You must remember the 5-part BLOG series I did about Friendship.

They must have been quite concerned because nothing was happening with the Tunnel Plaza Improvements for years! You remember the BLOG I did about this property right across from the Tunnel. Why it was empty for so long that they must have lost a fortune in rental revenue.

Moreover, their Duty Free business must have been suffering badly with the huge reduction in traffic as well. With the improvements at the Ambassador Bridge, who would ever want to use the Tunnel.

Please note above the Mayor's declaration of pecuniary interest and declaration thereof in only two of them. Edgar is so modest. "member of the former campaign." Pshaw, Abe was his campaign manager. As the City Clerk told me after I asked, remember:

• ----- Original Message -----
  From: Critchley, Valerie
  To: arditti@sympatico.ca
  Sent: Tuesday, February 12, 2008 12:40 PM
  Subject: FW: Declaration of Pecuniary Interest
  
  Good Afternoon:
  
  Thank-you for your inquiry which has been directed to me for response.
  
  I can advise that the Mayor has always been cautious to take the high ground with respect to any possibility of an actual or perceived conflict of interest and has always chosen to excuse himself from any discussion or voting on any matter related to the Duty Free Shop. The basis of his caution is his personal acquaintance with Abe Taqtaq, his former campaign manager. Also, while the Municipal Conflict of Interest Act excludes matters that are remote and insignificant, the Mayor has also noted that his spouse is a tenant in a building that Mr. Taqtaq has an interest in.
  
  I trust this answers your inquiry and remain,
  
  Yours Truly,
  
  Valerie Critchley
  City Clerk
  Corporation of the City of Windsor"

The Taqtaqs must be overjoyed that part of the DRIC compromise negotiated by Edgar resulted in so much more money being given to the project so that their business operations can be improved and so that their land can finally be expropriated. Didn't the Star say at one time that:

• "Closing a portion of Goyeau Street to all but tunnel-bound traffic is being considered by the Windsor Tunnel Commission as a solution to the traffic tie-ups at Goyeau and Wyandotte Street East. The closure, which would affect Goyeau between Park Street and Wyandotte, would allow an expansion of the tunnel plaza and reduce the congestion during morning rush hour and at other peak crossing times.
  
  "The status quo simply isn't working," said Mayor Eddie Francis, who is chairman of the commission. "We don't want people to panic because it may not be feasible, but we have to find an alternative to a situation which has become intolerable for our citizens, for commuters and for tourists."
  
  The commission has requested a report from the traffic engineering department on the impact of closing the street and what it would do to traffic patterns in the immediate vicinity.
  
  Along the stretch of Goyeau being considered, the only building not owned by either the city or the Windsor Tunnel Duty Free Shop is a Burger King franchise opposite the tunnel entrance."

Of course as I said above, the Mayor must protect the Tunnel's business but note this as well where the Mayor did NOT disclose a pecuniary interest when he was a Councillor. I do not know why he did not do so:

He introduced the Motion to support what the Duty Free Shop wanted and did not declare a pecuniary interest.

Remember also the Coltaq Motion introduced by the Mayor that must have helped the Coltaq and Collavino families:


Moreover, Phase One of the Let's Get Windsor-Essex Moving Strategy included:

• "Windsor, Ontario, March 11, 2004 - The Governments of Canada, Ontario and Windsor today announced new measures that are part of a joint $300 million federal-provincial investment to help improve the Windsor Gateway, Canada's busiest border crossing.Today's agreement identifies five initial project investments, including:
  
  •Improvements to the Windsor-Detroit Tunnel Plaza in order to provide for more effective traffic management, including the implementation of the NEXUS program;"

At the time, the decision to focus on the Tunnel made little sense to me when Huron Church was supposed to be the trouble spot. And the agreement was signed within months of Edgar becoming Mayor too. The improvements are very important to the Taqtaq family because business was hurting at the Tunnel obviously with the reduced number of visitors:

• "Traffic at the Windsor-Detroit tunnel remains in a slump, and the border crossing's retail duty-free store is feeling the impact. It's been this way for months, and while the list of reasons seems as long as the tie-ups some days, Marwan Taqtaq, who operates the Windsor Tunnel Duty Free Shop with his family and staff, remains optimistic.
  
  The pending redesign of the tunnel plaza is expected to provide better store access for vehicles."

In passing, did the request to "abandon a standard" create a huge liability on the City if something went wrong? How could the City argue that it was acting in a reasonable manner by abandoning what the association said should be done?

I don't recall the City negotiating that kind of money for the Tunnel's border competitor, the Ambassador Bridge, to improve their operation as part of the Strategy. There was $300M in BIF money around after all. Why not? They are an important crossing too. They have been hurt in traffic reduction. Their Duty Free Shop must have lost business.

There never was a Phase II Agreement which presumably would have dealt with the Bridge. What the Bridge received from Edgar, instead of helping them with a property issue, was the denial of demolishing homes on Indian Road!

There you have it dear reader. The new game, an explanation of each of the key elements and knowledge about the border file so that you can dazzle your friends with three little words.

Enjoy!

Some Info About Matty Moroun

Here are some things that you may not have known about Matty Moroun

THE MATTY

That should be his new name after a story was written about him:

• "Detroit's Donald Trump Is Buying Up Small Lots Across the City...
  
  His name is not as well known as Donald Trump, but Manuel "Matty" Moroun is clearly a landed force to be reckoned with in his home state...
  
  how come he doesn't have his own TV show like that other real estate mogul"

This was a comment about the Detroit Free Press articles about him buying property in Detroit.

Wouldn't you just love to see him say to Edgar (aka Eddie): "You're Fired!

WHY DOES THE MATTY BUY PROPERTIES

• "Moroun said he buys property in Detroit hoping to provide truck and rail hubs to industry"
  
  "He concentrates his buying in areas of Detroit once known as industrial and transportation hubs and where he hopes his holdings might contribute to a revival."

While Edgar runs off to Germany and has Lufthansa do a study where we know that City taxpayer money will have to be spent to encourage business to come to our Cargo Shanty at the airport, The Matty spends his own private money to accomplish the same objective.

WHY TRANSPORT 2000 SHOULD LOVE THE MATTY

• "Today we're buying property on the southwest side of Detroit because that's the only place for rail. ... I don't know why everybody's hell-bent on knocking rail out. They're making a mistake."

DRTP will have to talk to him if they have any hope of building their rail tunnel.

THE MATTY COMMENT THAT CAUSED HEART ATTACKS AGAIN IN OTTAWA

• "Moroun said he bought land as an active investment, trying to make something happen, not as a passive speculator."

Now here it comes:

• "I'm not a speculator. I don't sell anything."

So much for the Prime Minister's secret mandate letter to buy the Ambassador Bridge

And to emphasize the point:

• "Moran, Moroun's corporation counsel, dismissed such complaints. He said Moroun hopes and plans to redevelop as much of his Detroit property as he can.
  
  "We're not just buying it waiting for someone else to come along and want it and then get a price out of it," Moran said. "We're buying it because we have a game plan. Some of them are short term, most of them are long term, for the redevelopment of Detroit. In the meantime, we try and be as good a neighbor as we can. We pay taxes, and we help the city coffers."

That just follows what he said in the Detroit News in December 2008 if anyone forgot:

• "The bridge is a living thing," Moroun said. "It's become part of me and I think I've done a good job. It's my legacy. They want to steal it from me but that's not going to happen, I promise."

I am sure that I do not have to remind bureaucrats of the Globe and Mail 2 1/2 page spread either.

DOES THE MATTY HAVE AN OFFER CANADA CANNOT REFUSE

I Blogged before that Canada should have worked with him but the Ottawa types refused to do so.

• "He at times smiled, chuckled, grew pensive, and often urged a Free Press reporter to treat him fairly.
  
  He complained of being "demonized" and "vilified" in news media reports, and urged a Free Press reporter to "Rise above it!"

Thanks to Line of Sight's BLOG, I forgot what had been written before about him during the FIRA era where he was investigated when he wanted to buy the Bridge. That clearly explains the smear tactics being used against him today:

• "Moroun often finds himself in court. The Canadians, citing federal law, were demanding 50 percent interest when he took control of the bridge in 1979. Moroun took the Canadian government to court in the United States. The Canadians struck back, launching an investigation into his background, intimating that Moroun had ties to organized crime. The allegation was never proven. After a decade in court, the Canadians capitulated, settling for almost nothing, except an agreement that Moroun make improvements to the bridge."

That tactic did not work before but Canada is trying it again. That is why The Matty has become the most "public" reclusive billionaire ever!

And the Free Press real estate stories and Editorial---timed perfectly in advance of this Friday's pro-DRIC rally.

BLOGexclusive: SOS DRIC SOS

The call has gone out and the friends of DRIC are responding.

Who cares if DRIC will cost Senior Citizens in Michigan more money. No time to listen to them when DRIC duty calls. No answers either to their questions.

DRIC is in big trouble. Gather the forces to save it from being ended. Saving taxpayer money, get real.... The boondoggle must go on!

Big meeting to convince and pressure the Michigan Legislature to salvage the unsalvageable DRIC. Or rather to pass P3 legislation to help make Wall Street investment bankers rich again.

Has anyone seen the financing numbers report from Wilbur Smith yet? I have not seen the report publicly even though the traffic numbers report was issued some time ago. If not, I can guess why.

They have to be so horrible meaning that an "alternative payment" regime is necessary because there is not enough money in toll revenues or the tolls would be so high no one would ever cross the border in Detroit/Windsor (except at the lower cost Ambassador Bridge!). ie taxpayer subsidy needed. After all, the total cost is $5 billion for roads, plazas and bridge.

As I Blogged before: http://windsorcityon.blogspot.com/2010/01/why-did-canada-do-it.html

• "That is why separately Transport Canada's Mark Butler said:
  
  "We are continuing our discussions with Michigan on governance issues and financing issues,” said Mark Butler, a Windsor-based spokesman for Transport Canada...
  
  Butler said the Canadian government would prefer that the new cable-stayed or suspension bridge be undertaken on the basis of a public-private partnership. But he said this approach is not yet set in stone."
  
  Now you know why it is not set in stone. But it gets even worse:
  
  "Given the anticipated tolled nature of the border crossing, MDOT 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."
  
  What a joke...from real tolls to phony tolls ie payments support by either direct Government payments or guarantee or subsidies. All at extra taxpayer expense forever! They dare not say that in the RFPOI because then the Legislator who reads it would know that this is a financial disaster.
  
  "Current market conditons" is a euphemism for saying there is no way that a "real toll" bridge could ever be considered because of
  
  ---the multi-billion cost which would drive users away
  
  ---economic melt-down,
  
  ---lack of infrastructure money and
  
  ---competiton from the Ambassador Bridge whose tolls would be 1/4 of that of the DRIC bridge.

If there is no legislative approval, then the project is dead. Think how badly off financially and upset the DRIC consultants and engineers and bankers and P3 operators and lobbyists and lawyers will be. $60M or so earned so far from this project on both sides of the border and even more millions yet to be made at public expense!

Never mind how distraught Canada and its bureaucrats and politicians will become. Another effort to beat Moroun and take away his bridge cheaply down the drain.

Now you know why Prime Minister Stephen Harper sent out his secret mandate letter to buy the Ambassador Bridge. He knows that the DRIC was always a phony and that the DRIC supporters in Michigan have blown it.

We need to run a pool about who will be attending the meeting. I need a trustworthy person to mark off the political, business and labour people from this list below. Those are my guesses. Perhaps Sarah Hubbard from the Detroit Chamber could do it. I am sure she WILL be there.

These people surely will be attending, rooting for DRIC even if some of them are supposed to be independent and not a cheerleader. I mean they were there when DRIC needed them before: