Windsor Ontario - The shelving of a proposed new rail tunnel between Windsor and Detroit was not the news the region wanted to hear this week, but it was not altogether unexpected.
 
And while the deferment of the $400 million project and loss of the potential benefits from the huge construction project is a bit of an economic blow, it isn't the painful hit it might have been had a new, $2.1 billion international bridge not already been green-lighted.
 
A parallel rail crossing would have been a welcome bonus to the region, but few were banking on it for the future.
 
The back story is, CP and its investment partners believed they could convince Canadian and U.S. governments, particularly the one in Ottawa, to pay for a major portion of the asset, first by turning the old tunnel into a truck route, then by subsidizing a new dig.
 
Michigan was the only jurisdiction to make a pledge.
 
While nobody in Washington, Queen's Park, or Ottawa ever uttered a definitive "no" to also supporting the new rail tunnel it was understood that none of the three governments believed they should pay 50 percent of the cost, at least $200 million, according to decade-old estimates.
 
In Ottawa, word was that expecting the public to foot so much of the bill for CP shareholders was far too rich of an "ask".
 
For their part, the project's proponents, who included pension giant Borealis Infrastructure, never appeared to budge from their request.
 
Those who have been following the project since its genesis in the late 1990s believe CP feels it is owed a new tunnel by taxpayers because Ottawa footed the entire bill when CN Rail built a similar tunnel under the St. Clair River between Sarnia and Port Huron.
 
CN Rail was a publicly-owned Crown corporation at the time.
 
CN was later sold to private investors, and now uses the high-clearance tunnel to steal at least some tall traffic away from CP.
 
Unfair?
 
To the taxpayers who paid for an asset now largely controlled by American investors, absolutely.
 
But making taxpayers pay for a second tunnel to benefit a second group of private investors is no sensible way to even the score.
 
And so the project has languished year after year, the lobbying bills and retainer fees mounting into the millions to no effect for CP and Borealis.
 
Which is why the project was officially put into a semi-permanent limbo this week.
 
CP's public position is that digging a new tunnel would create 2,200 jobs and other spin offs which would benefit the entire region, a claim few dispute.
 
It would enhance Windsor and Detroit's reputations as a transportation hub, also not in dispute.
 
A new tunnel will be needed eventually, in half a century, perhaps.
 
But the proponents need to come back with a better business plan when they ask for public help again, one that doesn't involve paying for half the freight.

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