407 etr

It seems that the Ontario Govt recognises the inevitability of their situation.....

"The Ontario government and the operators of Highway 407 emerged from an opening conflict in what promises to be innumerable court battles with both sides claiming victory -- and motorists using the road still paying higher tolls.

The 407 consortium trumpeted the fact that Mr. Justice Ian Nordheimer of the Ontario Superior Court of Justice said that the government's attempt to declare the owners in default of the 99-year contract could not begin until the two sides had gone through a lengthy dispute-resolution process set out in the agreement.

Transportation Minister Harinder Takhar countered that the delay meant little because the judge did not rule on the 407 consortium's claim that the Feb. 1 toll increase did not violate the agreement signed by the previous Progressive Conservative government on the eve of the 1999 election.

And he said he was "pleased" that the company has agreed to place the money collected from the toll increase in an escrow account so that it can be returned to drivers if the increase is voided.

The toll increase of one cent per kilometre brought the rate at peak travel hours to 13.95 cents. The cost of the average 19-kilometre 407 trip went up to $2.65 from $2.46.

Dale Albers, the spokesman for the consortium, said it will continue to charge the higher tolls. "We are confident in our contractual rights to raise tolls and we look forward to putting our case forward."

The sole shareholder, operator and manager of 407 ETR is 407 International Inc., a consortium comprised of the Canadian subsidiary of Cintra Concesiones de Infraestructuras de Transporte, which is co-owned by Grupo Ferrovial and Australian-headquartered Macquarie Infrastructure Group and Canadian-based SNC-Lavalin.

Mr. Takhar indicated that the fight has not left the Liberal government well disposed to signing further contracts with the consortium, despite the fact that the Liberals are considering creating new toll highways in the province.

"This is not a contract we [the Liberal government] signed. This is a terrible contract," he told reporters at Queen's Park.

"We would not sign a contract like that with any consortium. We're going to make sure that taxpayers are protected and that there are enough clauses [in new contracts] so that nobody has the exclusive right to increase any tolls. But we don't rule out toll highways at all."