Moroun family looks to state ballot tactic to protect its business

News item:

The Detroit International Bridge Company, which owns the Ambassador Bridge, wants to put a state constitutional amendment on the ballot, one that would require a statewide vote for the New International Trade Crossing bridge to go forward.

There’s little mystery as to what this is really all about.  The bridge company is entirely owned by one family -- Manuel “Matty” Moroun, his wife Nora and their son, Matthew Moroun.

They have been fighting attempts to build a second, publicly owned bridge for years. So far, they have succeeded -- even though a new bridge has widespread corporate support.

Their latest tactic is this ballot drive, led by a committee named “The People Should Decide.”

Its website states:

“The people should decide whether state government may construct or finance new international bridges or tunnels for motor vehicles. Consistent with this policy, and to shield the people from unnecessary burdens, the State shall not undertake ownership and development or use state funds or resources for new international bridges or tunnels for motor vehicles unless first determined to be necessary and appropriate by majority vote of the people.”

For years, the family has fiercely fought to protect its monopoly by opposing a proposed new bridge, which would be a joint public-private project constructed two miles downriver. The Ambassador Bridge, which was built in 1929, is the only way heavy freight can cross the river, something essential for the automotive industry.

The government of Canada says a new bridge is essential -- as does Gov. Rick Snyder and most Michigan business interests.

The Legislature, however, has refused to vote on a new bridge. The governor is expected to soon announce a proposal to build the bridge without legislative approval -- which may account for the timing of the Moroun family’s ballot initiative.

But could their effort torpedo the governor’s?

That’s highly uncertain. Even if the proposed constitutional amendment gets on the ballot, it is uncertain whether it could affect a deal if one is arrived at prior to voter approval, according to Tom Shields, spokesperson for the coalition supporting a new bridge.

By law, about 325,000 signatures have to be submitted by the first week in July to get a constitutional amendment on the November ballot. Mickey Blashfield, the head of The People Should Decide, said the goal is to gather between 450,000 and 500,000 signatures.

He wouldn’t say what the budget is for paying to get signatures, but confirmed that “a firm is in the field” and that extensive grass-roots organizing is also under way.

It is legal for backers to pay circulators to obtain signatures to put measures on the ballot -- and you need extra, because some are always invalid. The market price per signature ranges from $4.50 to $6.00. Assuming an average cost of $5.25 and a 500,000 signature goal, the cost alone of obtaining signatures would be $2.63 million. Add to that the costs or any legal expenses and advertising.

What does all this mean?

First of all, it proves that the monopoly Ambassador Bridge operation is profitable indeed. Most people I talked with said a full-blown statewide campaign to pass the proposed amendment would cost at least $5 million. These expenditures are, of course, a business expense and therefore would constitute a nice tax deduction for the Detroit International Bridge Co.

Nevertheless, that’s still a lot of scratch to put on the table for a gambit that might or might not work. A spokesman for the new bridge said the language in the proposal might not be effective, because it refers to the use of “state funds,” whereas the new bridge would be financed up front by the Canadian government.

Putting a ballot proposal in play may also accelerate Gov. Rick Snyder’s attempts to get the NITC built. The rumor in Lansing is that the administration is aiming to make an announcement at the Detroit Regional Chamber of Commerce Policy Conference on Mackinac Island at the end of May.

But beyond all that, should a measure designed to protect a privately held monopoly from competition be inserted into the constitution of the state of Michigan?

Constitutions are meant to be basic governing documents, not collections of special interest provisions for individual profit-making companies.

Cynics might conclude that in wanting to put this issue up for a public vote, the Moroun family is working to obtain the best democracy money can buy.

This is nothing new, of course. The U.S. Supreme Court, in its 2010 Citizens United decision, held that it’s OK for bored billionaires to put unlimited money into political action committees.

Michigan’s notoriously weak campaign finance reporting laws have never posed much of a barrier to various interests -- including the Morouns -- scattering millions of “contributions” into willing legislative hands. Indeed, some skeptics have suggested lawmakers would be perfectly happy if the Snyder administration found a way to get the new bridge under way without legislative approval, since that would avoid the risk of voting against the hand that feeds them.

What is clear is that the case for a comprehensive reform of Michigan campaign reporting laws has never been greater. We are now tolerating a system that produces the best -- or worst -- democracy money can buy.

And that is a terrible way to manage the affairs of our state.

Editor’s note: Former newspaper publisher and University of Michigan Regent Phil Power is a longtime observer of Michigan politics and economics. He is also the founder and chairman of the Center for Michigan, a nonprofit, bipartisan centrist think–and–do tank, designed to cure Michigan’s dysfunctional political culture; the Center also publishes Bridge Magazine. The opinions expressed here are Power’s own and do not represent the official views of the Center. He welcomes your comments via email.

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Thu, 04/26/2012 - 7:35am
OMG, the Bridge Company is prepared to let the People decide. However, the DRIC-ites want to endrun them. What a turn of events. This column is so funny. Lash out at a business person trying to prevent his business from being destroyed and spending his own money to do it. YET support an Administration who is prepared to endrun the Legislature just because it does not want this project and applaud a Governor who is being encouraged to endrun the People. Wow, what strain of Democracy is this in Michigan these days. Why are the DRIC-ites so afraid of the People. Could it be because the DRIC project is not financially viable with traffic down 40% since its peak over a decade ago and not growing significantly! Oh and Phil, as far as "monopoly" goes, the Bridge Company is only exercising he rights that Governments gave them over 80 years ago. By the way, I hope that Phil asks for reforms that will prevent "foreign" governments from offering money to induce Legislators to vote for proposals they want. $550M is a lot of money that Canada has offered isn't it and for what reason. Finally Phil, wasn't there something inserted in the Constitution re the Mackinac Bridge and wasn't there a constitutional amendment being proposed re DRIC to protect taxpayers. Whatever happened to that?
Sam Hagar
Thu, 04/26/2012 - 10:55am
Easy solution to this problem - have the State take the Ambassador Bridge using eminent domain laws.
Thu, 04/26/2012 - 8:02pm
Sam, So your solution is what they government wants they should just take it? Do you feel that there should be no such thing as private property?
Nicole Perry
Thu, 04/26/2012 - 4:25pm
When you say the new bridge will be publicly owned --what exactly does that mean? Will I get to share in the revenues/tolls? If it fails to recoup the cost of building it, will I be in debt -- or my grandkids? And why is it some reports say it will be a public/PRIVATE bridge. Who are the private owners and will they get to enjoy the revenues more than me? And why would Canada be willing to give us a $4 billion bridge? Have we now reversed roles and become the 3rd world country that other countries invest in us because we can't manage on our own? Consider the posibility that the legislature decided the new bridge was not a good idea and the majority of Michigan residents don't want it. Just like the remonumentation of Michigan (which was not good for the average resident) keeps the surveyors employed indefinitely, I can see where the journalists will have plenty to write about the new bridge. But is it good for ME and my grandchildren? Convince me like a car salesman convinces a buyer to trade in their old car for a shiny new one.
Thu, 04/26/2012 - 8:10pm
NO one has yet explained what is wrong with private ownership of the Bridge? Has it been badly managed, has it been poorly maintianed (as many of the governemnt owned bridges) and has the bridge maintenance cause accidents and deaths (as has happened on governement owned and maintiained bridges)? What is so evil about private ownership? If it is so bad for privae ownership of such public transportation facilities, why are states selling their toll ways to private investors? How and why did Moroun get possession of the bridge? If Mr. Power has share that with us, then I apologize for missing it and would surely appreciate be directed to where I can read it.
Sun, 04/29/2012 - 10:54am
Er, what's you point? Maroun can keep his bridge, no one is trying to take his toy away.
Nicole Perry
Sat, 05/05/2012 - 7:13pm
The point is that a BIG issue has been made by supporters of the new bridge proposal that there is something wrong with his ownership of the Ambassador. Yet many of these same business folk also support privatization over government ownership because it's more efficient. Go figure.
Jeffrey Poling
Thu, 04/26/2012 - 8:34pm
Mr. Joe Blog, just one overwelming fact before I offer my argument counter to your's; Windsor, Ontario Canada will not allow Matty Moroun's proposed bridge to enter Windsor where Mr. Moroun intends to build it. Period! Despite this, Mr. Moroun went ahead and prepared ramps to his twin bridge anyway! Regarding need, Mr. Moroun bases his argument against the need for a 2nd bridge on the period between 1991 to 2011, during which we suffered 3 significant recessions which negatively affected commercial traffic between the U.S. and Canada. While arguing that there is no justification for a 2nd bridge, he has spent $millions preparing to build his own 2nd bridge. His argument is in direct conflict with his actions. Canada remains the United States' single largest trade partner. The need clearly exists and Mr. Moroun knows it. By focusing his argument against need, he hopes to divert attention away from his true objective - maintaining his monopoly by eliminating any and all competition to his Ambassador Bridge - Detroit's only significant trade link with Canada. Although apparently legal, it is still astonishing that a private individual is allowed to own and control an international border crossing. The negative assertion that this is a government take over is absurd. Infrastructure such as bridges and roads are publicly owned the world over and for good reason. The Ambassador Bridge is the rare exception. In the interests of security alone, border control should be an exclusive function of government, not a private, lucrative monopoly as Mr. Moroun enjoys here in Detroit. The issue however, is much greater than public vs private control of bridges. It is public vs private control of government. While Mr. Moroun would have us believe in his "civic responsibility" with his "The People Should Decide" ballot proposal, he has repeatedly contradicted that by "buying" government officials influence with generous campaign contributions, influencial lobbyists and special interest groups such as Americans for Prosperity. Regarding Mr. Moroun's community involvement, again his actions speak louder than his words. Consider the following: 1) Posting fake eviction notices on the homes of Delray residents is a fear tactic which speaks volumes on the tactics he is willing to use to maintain his monopoly. 2) Mr. Moroun has selfishly held up progress on the NITC knowing full well that the City of Windsor will not allow his twin bridge to enter the city. In January 2010, Mr. Moroun bought the Yellow Freight truck terminal in Delray which lies in the footprint of the NITC bridge. Coincidence or a tactic designed to delay the NITC? 3) In direct defiance of MDOT's requirements, Mr. Moroun built his own Ambassador Bridge plaza to incorporate a duty free store and a tax free fueling station meant to further line his pockets with cash. He has ignored Judge Edwards' orders to rebuild the bridge approaches to comply with MDOT's requirements and was jailed on contempt of court charges. As a last resort to quell Mr. Moroun's defiance, Judge Edwards took control of the bridge plaza project away from Moroun and awarded it to MDOT. 4) The most photographed and nationally publicized symbol of Detroit's decay is the abandoned Michigan Central Station. Just recently, Mr. Moroun, the owner of the Michigan Central Station, announced that he will replace the windows and install a new roof. After 15 years of derelict ownership during which he has willingly allowed this once beautiful structure to decay and rot, he suddenly decided to express his civic responsibility. Sorry Mr. Moroun, you're not fooling anyone - Too Little, Too Late. It should be obvious that this is not an issue of oppressive government control over private enterprise. It is just the opposite - it is Matty Moroun attempting to maintain his monopolistic control over the needs of our auto industry, the cities of Detroit and Windsor, the State of Michigan and two Countries.
Sun, 04/29/2012 - 10:39am
Phil, Baby! The Michigan constitution already protects a private monopoly: casinos.
Nicole Perry
Sat, 05/05/2012 - 4:18pm
I think some of my questions may have been answered by Crain's Detroit Business. "The state intends to own and oversee the span jointly with Canada, but it will be built by the private sector and operated on a long-term concession that uses toll revenue to pay off the capital debt." So,how does that differ from Moroun's ownership of the Anbassador? He bought the bridge (instead of building it) with private funds and he collected the toll revenue to pay for it. The only difference I see is that he manages it instead of the state -- but looking at state management (especially the DNR -- didn't they have a muti-milliom dollar accounting blooper a few years back?), I'd stick with Moroun on that issue. Also, what's this about a default clause in the governor's proposed contract with foreign investors and contractors? I'm confused but is it possible that (if Snyder's projected revenues based on bridge traffic are exagerated -- no really?) the bridge could end up being foreclosed on by foreign interests? Let me see -- do I want Matty who was raised in Detroit and has a family and home here and has been successfully managing and maintaining the bridge for decades owning our major trade access to Canada - or say Korea? Or China?
Nicole Perry
Sat, 05/05/2012 - 5:34pm
One more thing. Paying folks a wage to go out and collect signatures is not the same as paying for the signatures outright. It's that spinning that makes people like me distrust reporters. We're not as dumb as a box of rocks.