CUSLI expert roundtable report on international trade and North American infrastructure.

PositionCanada-United States Law Institute

The following is a report of the Canada-United States Law Institute's October 2015 Experts' Meeting held in Washington, D.C. The Meeting focused on the current state and future of North American infrastructure development and current international trade topics.

TABLE OF CONTENTS I. Introduction II. Infrastructure Development Practices in Canada III. Infrastructure Development Practices in the U.S. IV. P3s and the Future of North American Infrastructure Development V. The Trans-Pacific Partnership VI. Bilateral Issues Concerning Trans-Pacific Partnership and Beyond VII. Conclusion I. INTRODUCTION

On October 29, 2015, the Canada-United States Law Institute (CUSLI) (2) hosted an expert panel discussion at the Steptoe & Johnson PLLC's Washington, D.C. offices. The purpose of the meeting was to discuss infrastructure development as a driver of economic growth and current developments in Canada-United States trade issues. Expert participants sought to identify distinctions between Canadian and U.S. infrastructure development policies and practices as well as discuss the future of current trade topics and their immediate impact on North American economic interests.

The meeting featured distinguished experts from both the public and private spheres in Canada and the United States. The meeting was broken into two expert panel discussions: one focused on approaches to infrastructure development, while the other concentrated on the changing political dynamics of the Trans-Pacific Partnership ("TPP"). During the first panel, experts discussed the value of public-private partnerships in promoting economic development. In the second panel, meeting participants focused on Canadian and American attitudes toward the TPP, as well as how recent political developments would impact the ratification of the partnership between Canada, the United States, and states along the Pacific Rim.

Several important themes emerged from the expert panel discussions. Regarding infrastructure and development, participants first highlighted the successful implementation of public-private partnerships ("P3") in Canada. Secondly, participants described the challenges to P3 in the United States, while examining how transportation agencies have engaged in these ventures. Lastly, participants discussed the future of P3 in the two countries.

Concerning trade issues, the discussion focused mainly on TPP. First, participants discussed recent political developments in Canada and the United States that may affect the ratification of TPP. Second, participants provided an overview of the creation of TPP and its relationship to the larger global trade environment. Third, participants described the stages of the ratification process and speculated about challenges at each stage. Finally, the participants turned to how TPP might affect the Canada-United States relationship.


    The first expert panel focused on innovative approaches to infrastructure development opportunities in Canada and the United States, namely public-private partnerships ("P3s"). Participants first analyzed the evolution of infrastructure development practices in Canada. Participants posited that until approximately twenty years ago, Canada relied on traditional practices of infrastructure funding. These traditional practices required government funding at or near the full cost of the infrastructure project through a combination of direct expenditures, bond or debt issuances, or tolls and fees. However, there were many risks associated with this traditional approach; for instance, revenue authorities were not always able to guarantee the full level of revenue over the life of project payments.

    As a result, over the past twenty years, Canada has encouraged partnerships between the public and private sectors to build and maintain infrastructure projects. These P3s allow the government to shift immediate financial responsibility to construction corporations under a long-term financing plan with either the federal government or provincial governments. Corporations, in turn, finance infrastructure development projects through direct expenditures, bank loans, bonds, and guarantees of future payments. P3s allow for greater flexibility in long-term financing, as the government and corporations can work together to establish a payment system...

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