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Public-Private Partnerships in Michigan: Beyond the Bridge

Ambassador Bridge PhotoLost in the debate in what has become the latest battleground between the State of Michigan and the Detroit International Bridge Company over who will build the new bridge between Detroit and Windsor, is HB4961 and the fact that this legislation, if enacted, can help to solve Michigan’s troubled transportation funding situation.

Michigan’s transportation funding dilemma has reached critical proportions.  The downturn in the economy has changed our driving habits.  Less miles driven and more fuel-efficient cars equals less gasoline consumption, reducing the revenue the state gains from the gas tax.  This tax is the primary funding source for maintenance and improvements to our roads, which any Michigan driver knows is sorely needed.  Revenues are now so low Michigan is in grave danger of failing to qualify for federal matching funds.

I don’t believe that there is a single solution to this crisis, but one progressive idea that has been proposed in HB4961 is the concept of a public-private partnership (P3) to fund new projects.  The idea is that money from the private sector would be used to fund transportation projects.  Investors of the projects would be paid back through tolls or other agreed upon means.  Some of the projects under consideration include:

  • A new rail tunnel from Windsor to Detroit, which would allow for the movement of overseas containers stacked 2 high
  • Commuter rail from Ann Arbor to Detroit and Ann Arbor to Howell
  • A new overseas container yard in southwest Detroit
  • Improvements to the Blue Water Bridge
  • Various road improvement projects: I-75 in Oakland County, I-94 in Detroit and Jackson, US-23, M-231 and M-59
  • And of course, a second bridge between Detroit and Windsor

In order to keep Michigan competitive in the global economy it is necessary to do more than just basic maintenance to our roads and logistics infrastructure.  The current tax structure is not collecting enough revenue to maintain this infrastructure, let alone improve and expand it.  The research that has been presented on Public-Private Partnerships in other states is encouraging and I think just one of the many solutions needed to get Michigan moving again.