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Government to start paying for bridge

Danielle Sachs
Northern News Services
Published Friday, June 8, 2012

This is the first year the territorial government will start paying for the Deh Cho Bridge.

For the next 35 years, the government will make biannual payments toward the $165.4 million in bonds taken out to pay for the bridge.

Starting with the 2012-2013 budget, $8.07 million will be paid back, representing 12.4 per cent of the total highway budget under the Department of Transportation.

Earl Blacklock, manager of public affairs and communications at the Department of Transportation, said the payments will be made twice a year, approximately every six months.

It was during budget deliberations May 31 that Range Lake MLA Daryl Dolynny asked about expenses in the highway section of the budget.

"I get a little upset over the word 'other,'" said Dolynny. "This is an ongoing payment and it just doesn't seem transparent."

Pointing out that the $8.07 million was significantly higher than the $2.78 million listed for 2011-2012, Dolynny asked for an itemized list of what was being covered under the category.

"The majority of that would be for the Deh Cho Bridge interest expense and charge-back expenses," said Transportation Minister David Ramsay.

The $165.4 million is just the starting principle on the bonds, it does not include the added annual interest rate of 3.17 per cent plus interest tied to the rate of inflation.

Russel Neudorf, deputy Transportation minister, said the bonds were issued for a period of 35 years, and are subject to inflation.

"The repayment required every year would go up by the amount of inflation," said Neudorf.

Blacklock said the average Consumer Price Index - or inflation rate - for the past 20 years has been 1.87 per cent. He said a reasonable estimate of inflation for future years would be two per cent.

"It should be noted that toll revenues would also increase at the same rate," said Blacklock.

The government intends to pay for the bridge by charging tolls on commercial traffic crossing it, and through savings by shutting down ferry service and not building an ice road. The GNWT is proposing tolls starting at $91.25 to $275 per vehicle, depending on the number of axles and whether a remittance plan is in place.

The bridge is expected to open this fall. Although Blacklock said with any capital project there's always an element of uncertainty. "At this point, the closer it gets to the target date of completion the more sure we are of it opening."

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