Luisita Magsasaka


Metropac: SCTex contract cost “unrealistic”

MetroPac: SCTEx contract cost ‘unrealistic’ BusinessWorld | 02/09/2010 11:21 AM MANILA, Philippines –

Financial terms required by the government agency bidding out the contract to operate the country’s longest tollway are “unrealistic,” according to businessman Manuel V. Pangilinan. Traffic volume at the Subic-Clark-Tarlac Expressway (SCTEx) remains small and whoever wins the operation and management or O&M contract will have to shell out a huge sum for subsidies, he said in an interview last Friday. State-owned Bases Conversion and Development Authority (BCDA) is considering the financial offer of Manila North Tollways Corp., a unit of listed Metro Pacific Tollways Corp. which is part of the Pangilinan-led Metro Pacific Investments Corp., for the 94-kilometer SCTEx. The BCDA had actually rejected the financial offer of Manila North Tollways, although it passed technical requirements. Another bidder, Northlink Toll Management, Inc., a joint venture between San Miguel Corp. and Star Tollways Corp., was declared “ineligible” for failing to comply with the technical requirements. Both firms are appealing the BCDA’s decisions. Under BCDA’s terms, the winning bidder must bear the “operational funding requirements for the management, operations and maintenance of the SCTEx including periodic maintenance works, special/major/emergency works and all other additional works, and insurance.” The winner must also provide management services, toll collection, traffic safety and security management, tollroad maintenance including greenery and landscaping, and other related services. The BCDA wants a semiannual lease or concession fee amounting to either the peso equivalent of the yen-dominated loan taken out by the government to finance the tollway’s construction as well as all financing charges; or 20% of audited gross revenues, whichever is higher. Mr. Pangilinan, who is also chairman of Philippine Long Distance Telephone (PLDT) Co., said the BCDA’s requirements were “unrealistically high.” “Let me put it this way. The traffic and the revenues that are being generated by SCTEx are not sufficient to service that loan, period.” “So the concessionaire will have to subsidize and incur a loss. But who will do that for a number of years? Who would want to lose money?” he asked. BCDA officials could not be reached for a comment. The BCDA had estimated the annual loan payments to Japanese creditors at P1.2 billion starting 2011. The loan for the SCTEx project amounted to P26 billion. “I think their financial terms are unrealistic in relation to the projected traffic. The conces-sionaires will have to lose money in the first year,” Mr. Pangilinan said. Last year, more than 18,000 vehicles used the SCTEx daily on average. The original projection was an average of 35,000 vehicles daily in the first year of operation. The tollway is being operated temporarily by Tollways Management Corp., which is 46% owned by Metro Pacific Tollways. Manila North Tollways operates the North Luzon Expressway (NLEx), which is connected to SCTEx in Pampanga. It hiked profits by 16% to P1.17 billion on revenues of P4.07 billion from January to September 2009, when an average of 149,164 vehicles passed through NLEx. Metro Pacific is the Philippine unit of Hong Kong’s First Pacific Co. Ltd., which partly owns PLDT. Mediaquest Holdings, Inc., owned by the Beneficial Trust Fund of PLDT, has a minority stake in BusinessWorld. Shares in Metro Pacific stayed at P2.22 apiece yesterday after shedding 4% on Friday. abs-cbnNEWS.com is the online news department of ABS-CBN Interactive Inc., a subsidiary of ABS-CBN Broadcasting Corp. ABS-CBN and Meralco are both part of the Lopez Group of Companies. http://www.abs-cbnnews.com/nation/01/20/10/sctex-controversy-bigger-c-5-says-villar-ally SCTEx controversy bigger than C-5, says Villar ally by Carmela Fonbuena, abs-cbnNEWS.com/Newsbreak | 01/21/2010 12:54 AM MANILA, Philippines – The Aquino family should pay the government for the construction of the interchange in Hacienda Luisita, which is estimated to be worth around P170 million, an ally of Nacionalista Party (NP) standard-bearer Sen. Manuel Villar said. At the continuation of the House oversight committee hearing Wednesday on alleged irregularities in the Subic Clark Tarlac Expressway (SCTEx), Cavite Rep. Jesus Crispin ‘Boying’ Remulla said the family of presidential survey frontrunner Benigno ‘Noynoy’ Aquino III should refund the government for the purchase of the allegedly overpriced right-of-way property for the SCTEx road project. He claimed that regular government procedure mandates the landowner should give the property to the government at zero cost. “Interchanges in private properties have to be paid for by the private property owners. He should donate the right-of-way. They [Aquinos] still have the industrial land,” Remulla said. Remulla also claimed that the SCTEx road controversy is “bigger” than the C-5 road extension project scandal against Villar. “’Yong kay Villar, zonal value ang pinag-uusapan. Hindi overpriced. Dito may interchange pa. Ang laki ng kanilang pakinabang masyado,” Remulla said. No overprice, no payment needed Sought for comment by abs-cbnNEWS.com/Newsbreak, Aquino’s spokesman, Edwin Lacierda said the interchange “need not be paid because the contractors designed the Luisita toll to be the end point.” In a text message, he said the interchange was “supposed to promote commerce between Subic and the Luisita industrial zone corridor.” Lacierda also said Remulla has not presented evidence that the right-of-way property was overpriced. “He has been mouthing overprice without proof. Government officials have already testified to the non-overpricing. This is not C-5,” Lacierda said. He said Remulla should not “divert the issue.” During Wednesday’s hearing, retired Brig. Gen. Robert Gervacio, the Bases Conversion Development Authority (BCDA) program manager for SCTEx’s operational and support services, cleared Aquino of any wrongdoing in the project. “Everything is aboveboard. There was no contact between BCDA and Senator Aquino,” Gervacio said in response to questions raised by Akbayan Rep. Ana Theresia “Risa” Hontiveros, a guest senatorial candidate of the Liberal Party. Extraordinary transaction? Philippine National Construction Corp. President Maria Teresa Defensor on Wednesday’s hearing testified that the government does not ordinarily pay private landowners for right-of-way properties in government projects because the private landowner presumably benefits from the construction of a national road. Defensor also testified that the Toll Regulatory Board, which processes applications for interchanges in major road projects, does not normally pay for the construction of interchanges in private lands. She said there’s a process where private landowners apply for the construction of an interchange and, if approved, shoulder the full cost of construction. This is also because the value of the land will presumably increase, and the landowner benefits from the rise in property values resulting from the infrastructure project. “Ang suwerte naman nila masyado. The value of the industrial land is now P1,000 per hectare because of the interchange,” Remulla said. The cost of the interchange built inside the Hacienda Luisita complex was shouldered by the government and funded through a loan from the Japan Bank and International Corp. It is a flagship project of President Gloria Arroyo. Just lucky? However, Bases Conversion and Development Authority (BCDA)-SCTEx project engineering chief retired general Eduardo Lena explained that the government paid for the construction of the interchange because it was part of the original plan for SCTEx. The hearing failed to directly link Senator Aquino to the allegedly irregular transaction. The BCDA had negotiated with Senator Aquino’s uncle, Pedro Cojuangco. But Remulla said Senator Aquino should still be held accountable. “It’s the uncle. It’s just one family you are dealing with. And he is a direct beneficiary. He cannot control his family. Patay malisya siya pag family ang involved. Pero nakinabang siya,” he said. Remulla added that it is also a taxpayers’ issue because the people will shoulder the cost of the loan. SCTEx controversy The SCTex controversy began in November 2009 with Remulla’s allegations that Senator Aquino’s family benefited from the allegedly overpriced sale of the right-of-way property. The property was sold for P100 per hectare. Remulla questioned it because the zonal value was only P8, he said. The controversy has since branched out into several other allegations of irregularities such as: -Senator Aquino’s family allegedly failed to fairly distribute to the farmers their share in the sale of the right-of-way property; -The contraction of the interchange inside the Hacienda Luisita was allegedly irregular; -The Cojuangco family has allegedly not been paying government royalty fees for the quarrying activities inside Hacienda Luisita. Remulla also revived calls for the Cojuangco family to distribute Hacienda Luisita to the farmers. Remulla said there will be two to three more hearings on the controversy.

Contributor: Maria Elizabeth Embry


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