Detroit River International Crossing (DRIC) New International Trade Crossing (NITC)

1. Detroit River International Crossing (DRIC) New International Trade Crossing (NITC) Briefing for the Transportation Border Working Group November 8, 2012

2. Windsor-Detroit Trade Corridor: Critical for Canada’s Economic Security • Canada’s Busiest Crossing • $126 billion of two-way surface trade – 28% of total Canada-U.S. trade • Over 220,000 jobs in the region depend on this border crossing • Consists of four crossings: Windsor-Detroit tunnel, Ambassador Bridge, truck ferry and Canadian Pacific Railway tunnel Ambassador Bridge carries a third of Canada-U.S. truck traffic -1-

3. Rationale for the Project • Corridor is facing capacity challenges • Inadequate direct highway access (through central Windsor) and customs facilities • New bridge a key priority for shippers and manufacturers • Only major Ontario-U.S. crossing without significant redundant capacity for truck traffic

4. Project Location—Windsor-Detroit I-75 -4-

5. Canada pursuing a three-pronged strategyto advance the project

6. Policy: Canada-Michigan Crossing Agreement, June 2012 • Framework for each party’s roles and responsibilities • Project funded and delivered by Canada—no cost to Michigan • US responsible for its customs plaza • Buy America waiver to use only Canadian & American iron and steel • Requires U.S. Presidential permit to become effective in U.S. “an investment in the future of the North American economy” —Prime Minister Harper

7. State of Michigan(Governor) Government of Canada Michigan Strategic Fund Michigan DOT International Authority Windsor-Detroit Bridge Authority Concessionaire Policy: Governance Structure

8. Policy: Crossing Agreement • Windsor Detroit Bridge Authority responsible for management and procurement • Responsible for delivery of project on behalf of Canada and Michigan • Conducts procurement process and enters into contractual agreement with concessionaire • Oversees construction and manages operation of the crossing • Vehicle to flow Canada’s investment to project • Windsor-Detroit Bridge Authority created October 2012 • Approved by the Prime Minister – Canadian Crown corporation with 1 interim director • Complete Authority to be established in 2013 – 5 directors • International Authority reflects shared governance • 50/50 participation – 3 Canadian and 3 Michigan members (after Authority fully established) • Approves procurement process and final agreement

9. SECRET Legal: Bridge to Strengthen Trade Act • Introduced in October 2012 as part of the Budget Implementation Act II • Exempts DRIC construction from requiring certain permits, approvals or authorizations under a number of federal laws • Clarifies corporate governance issues and provides minor amendments to the International Bridges and Tunnels Act • Provides certainty to private sector bidders that the project will not be delayed or stopped by frivolous lawsuits on the Canadian side • DRIC must meet all obligations under relevant federal legislation pertaining to fisheries, species at risk and navigation • DRIC must comply with the commitments made in the federal environmental assessment report 9

10. InternationalAuthority Michigan • Canada Canada Michigan Funding/Payments Provides assistance as requested by the Crossing Authority Approvals/oversight as per the Crossing Agreement Windsor-Detroit Bridge Authority Canadian Port of Entry MIPOE U.S.POE Bridge I-75 Interchange Financial: Procurement Structure

11. Financial – Timelines • Budget 2007 confirmed Canada’s intention to pursue a P3 • To design, build, finance and operate new crossing system under long-term concession • DRIC received environmental approvals in both Canada & U.S. in 2009 • Windsor Essex Parkway construction underway, completion expected 2015 • Budget 2007 committed Canada to contribute up to 50% of eligible capital costs • Property acquisition and utility relocation • Several industrial properties still to be acquired in Canada, utility relocation design beginning • No properties have been acquired in the U.S., utilities also have to be relocated • Project business case being completed • Based on an investment grade traffic and revenue forecast; robust project cost estimates; and market soundings • Timelines once approvals obtained and pre-procurement work completed • 18 months for actual project procurement process (Request for Qualifications - Request for Proposals - financial close) • Construction expected to take up to 5 years

12. Financial: Procurement of U.S. port of entry Procured as part of the P3 package? Yes will be included in P3 No Independently procured by GSA GSA works with Transport Canada/Crossing Authority to determine specifications and funding Economies of scale Integrated construction completion Canada will require cross default provisions to ensure the delivery of the U.S. POE on a consistent timeline to avoid payment of penalties to concessionaire Canada requires a firm assurance from U.S. Government on construction and operating commitments, including staffing, and timeframes before proceeding with the project

13. Next Steps • Confirm U.S. commitment for funding and required approvals • Develop project business case • Complete U.S. due diligence • Seek approvals in Canada • Complete establishment Windsor-Detroit Bridge Authority • Establish International Authority • Continue with property acquisition and utility relocation design in Canada • Continue to manage legal risks • Vigorously defend legal and trade challenges • Passage of Bridge to Strengthen Trade Act