Better Trade Between The United States & Atlantic Canada
by Sunjay Mathuria
This past October, a 240-kilometre, divided four-lane highway officially connected St. Stephen to River Glade, New Brunswick.
The project, Route 1 Gateway, is a part of the Borders Gateway initiative by the federal government and the provincial government of New Brunswick. The initiative would establish trade corridors between Canada and the United States to allow for better trade between the United States and Atlantic Canada.
In addition to trade, the highway project would enhance business and increase driving safety in the province.
There are significant benefits to separating oncoming traffic with a four-lane highway. “Any two-lane highway upgraded to a four-land system has benefits to the safety of the travelling public,” says Fred Blaney, a director of the Canadian Council for Public Private Partnerships.
A study conducted revealed that the rate of serious accidents dropped to about 5:1; 5 being on a two-way highway and 1 on a divided four-lane highway.
The trading corridor established provides direct access to the United States from the Atlantic region, offering an edge for the supply of goods and services.
This results in a “huge economic spinoff” for the province.
The project was cost-shared between the Province of New Brunswick and the federal government.
In addition to the two agreements with the federal government and the provincial government of New Brunswick, Dexter Construction Company Ltd. was responsible for the design/build portion of the project and Transfield Dexter Gateway Services Ltd. is in charge of the operation, maintenance and rehabilitation of the highway until 2040. Up to 75 per cent of the labour originated from New Brunswick; around 700 jobs were created at peak construction.
One of the most unique aspects of the Route 1 Gateway project is that it was completed through a Public-Private Partnership (PPP).
Blaney cites the several advantages to completing the project through a (PPP).
“This is the third PPP that we have conducted in the province in the delivery of highway infrastructure,” says Blaney. In 2001, the Fredericton-Moncton Highway Project was completed through a PPP, as was the 2007 Trans Canada Highway Project.
The project was delivered seven months ahead of schedule and was delivered $4 million under budget. Moreover, the safety record of the project was well below industry standards, which has been a record for all the highway projects.
“What happens with PPPs, is that you tap into the expertise of the industry to allow you to deliver infrastructure earlier. This has been our experience with all three of our highway projects. All three of them have been delivered on time and on budget,” explains Blaney.
“The most compelling reason to embark on these large projects is that the savings to the taxpayers. I think all jurisdictions should consider it as delivery model.”
PPP doesn’t just mean Public-Private Partnerships, according to Blaney. He explains the other three Ps: “You have to have the right projects and right candidate projects, which has potential for benefits. You have to have the right people involved and you have to have the right process to follow.”
An extensive screening process ensures the right candidates are chosen for PPPs. After the screening process, an evaluation process for money is completed, which is followed by marketplace and project agreement consultations.
The project did not come without its share of challenges. In the earlier stages of the project, for example, the contractor discovered an unknown archaeological site that required extensive evaluation. After working in partnership with the First Nations, the contractor was able to divert lanes around the affected sites without affecting the schedule of the project.
This example attests to Blaney’s point of developing a strong relationship with the right developer contractor. “One of the strengths of a PPP is that you have a developer contractor who has the resources where they can muster the resources to deal with large issues,” says Blaney. “They have the flexibility to be able to deal with these issues without limiting and affecting the schedule of the process.”
“To that end, the Canadian Council and the University of New Brunswick have recently partnered to try to put together forced curriculum for university students. Starting at that grassroots level was very important. A lot of the issues with the acceptance of PPP come from people not understanding them,” he says.
