N.W.T. MLAs demand way to kill Deh Cho Bridge project

Critics of a bridge over the Mackenzie River went after N.W.T. Premier Floyd Roland during question period Friday, armed with a newly-surfaced report that says the bridge project's costs would outweigh its benefits.

The regular, or non-cabinet, MLAs opposed to the project's financial situation want the government to kill it now, in order to save the territorial government millions of dollars over the next 35 years.

"Is the premier aware of any mechanisms we could use to put the Deh Cho Bridge Project before this house for a 'go-no go' vote?" Weledeh MLA Bob Bromley asked.

Roland said there is no simple, safe way to back out of the government-funded project now, telling the legislature that officials signed a concession agreement with the Deh Cho Bridge Corp. on Jan. 31.

Lawyers have until Feb. 22 to wrap up final details on the agreement. But Roland said the Fort Providence, N.W.T.-based bridge corporation has met all the conditions for the deal.

"If we were to back out now, we would, in my opinion … we would be challenged. We'd have to look at that, as to what the potential liabilities would be," Roland said, adding that the government has not sought legal advice about getting out of the agreement.

The concession agreement commits the territorial government to pay the bridge corporation roughly $2 million a year for 35 years to help cover the cost of building the bridge.

Roland gave regular MLAs a copy of the agreement Thursday night. Now those members are looking for independent legal advice on the penalties of cancelling the agreement.

"You know, who's got the liability here? We have the liability here," Hay River South MLA Jane Groenewegen said.

"If it's a no-go, our $9-million loan guarantee gets called and the government steps up for $9 million. But I don't see any liability on the other side."

Costs outweigh benefits: report

Government politicians and officials formally broke ground last summer on the bridge project, which is expected to provide a year-round shipping and transportation link between much of the N.W.T. and southern Canada.

Earlier this week, the regular MLAs demanded access to a cost-benefit analysis report that was prepared for the government.

The report, which appeared Thursday on the Transportation Department's website, confirmed their fears that the bridge's costs would be more than its benefits.

An Edmonton-based management consulting firm produced it in December, three months after the last administration, under then-premier Joe Handley, signed an agreement with the bridge corporation.

The cost of building the bridge has tripled over the last four years, from $55 million in 2003 to $165 million in 2007, according to the report. The latest figure includes a $10-million pre-funded contingency, but soaring construction costs and inflation were largely responsible for the price hike.

As a result, the bridge will cost $50 million more than its net benefit, the report concluded.

Furthermore, the consultants found that the N.W.T. government would have to put an extra $2 million a year into the bridge, on top of the nearly $3 million it has already committed to spend annually.

The government could also raise the bridge toll for commercial users, above the $6.50 a tonne currently proposed.

In terms of benefits, the report stated that the Fort Providence-based Deh Cho Bridge Corp. would gain from the project, and it would also lower the cost of living "marginally" for Yellowknife residents.

Cost-benefit analyses done in 2002 and 2003 concluded that the project's benefits should outweigh its costs.