Attention SLEX users!

[ryan17]

Hi everybody. Just want to share with you a column that came out in the Business World yesterday. Looks like something stinking is brewing involving the PNCC franchise over SLEX. I don't think we want to be surprised by a
!,000% toll fee hike (like what happened at NLEX), part of which will pay for the cost of under-the-table payments to you-know-who. So here it is:

Requiem for the PNCC franchise (Bernardo V. Lopez, Business World, Jan. 31, 2007)

PNCC is in a panic and is moving heaven and earth to have its franchise, which expires on April 30, renewed. But, as the saying goes, “You can fool some but you can’t fool all.” After passing House approval under suspicious circumstances at a time when campaign funds are much needed, franchise renewal is encountering stiff resistance with senators like Franklin Drilon and Serging Osmeña on the core issue of “corruption and incompetence.”

To date, the Supplementary Tollways Operation Agreement (STOA), the contract between a joint venture of PNCC, Malay-Thai Development Corporation and the Toll Regulatory Board for the expansion of the South Luzon Expressway (SLEX) remains scandalously a secret despite being a public document. Nobody knows its full contents. At the House Committee on Franchises, the figure of P8 billion as the SLEX expansion budget propped up. At the Senate it was p 11 billion with rumors it was being raised to P15 billion. Nobody knows the real figure because PNCC is perhaps scared of massive protests if it releases the entire STOA with all its fine print. The public does not know if future massive toll increases charged to them would reflect corruption in high places. The PNCC case is like at the Bataan Nuclear Reactor or NAIA 3 where such massive increases were questioned.

At the Senate committee on public services, a possible scam otherwise known as “the Radstock deal” was being investigated. Rastock is a Virgin-Island-based British “paper corporation” with a capitalization of $50,000 which bought a $50-million debt of PNCC to Marubeni for $2 million. It was able to collect a whopping $120 million or P6 billion from PNCC. The Senate was investigating if there was a deal to share the Radstock pie with PNCC officials. Sonny Dominquez is the Radstock representative here and Art Aguilar is the PNCC chairman of the board. PNCC admitted at the Senate hearings that there was no board resolution on PNCC’s guarantee of the loan. The hearings discovered that the loan, already considered a bad debt, suspiciously resurfaced in PNCC books recently, which PNCC admitted. After the Radstock scandal surfaced, PNCC now has the gall to say that it is borrowing P2.4 billion from PNB. It is incurring a debt to pay another debt to hide its bad financial image so the franchise can be renewed.

Joker Arroyo endorsed the PNCC franchise renewal. Some senators were speculating on a strategy of creating a “PNCC 2” which would start clean and have no obligations. How can they sweep the dirt of PNCC1 under the rug so nanchantly? The Senate voting during the third hearing was stopped by Drilon, triggering a tussle with Joker. It is a surprise that no representative from commuters or the general public were ever invited to both House and Senate hearings. No one is asking if toll increases will be just and if the public can afford such massive toll increases.

The House bill on the PNCC franchise was sponsored by two congressmen from Laguna, a key area of the Calabarazon whose industries and commuters are prime SLEX users. If the Laguna solons are running this election, they may just lose a lot of Laguna votes for supporting PNCC. Violent objections against the bill came from Congressman Mandanas of Batangas and Alvarado of Bulacan. They argued that PNCC was not fit to have a franchise renewal because it failed miserably in its first 30 years of operation, especially with accumulated debts. Indeed, the opposition claims the PNCC franchise is a violation of the Constitution which provides that such franchises should be a maximum of 25 years. The World Bank-IFC, which is giving the loan for the SLEX expansion, has been warned that corruption may be at the roots of its loan to PNCC and that this might translate into charging such corruption to commuters, the general public and the Calabarzon industries using SLEX. In response, a World Bank team commissioned directly by its President was sent to investigate the matter.

Despite the warnings and its own investigation, the bank is supporting the loan and in fact stated it would not release the money is PNCC loses its franchise. Why the Word Bank-IFC, which has a campaign against corruption, would give the loan despite warnings of corruption is a surprise to many. Is it because its prime concern is loan “collectivity” and profits” A loan to PNCC is government guaranteed but not to a private firm which may get the franchise. Ironically, the Word Bank gave $20 million to the government as an anti-corruption fund. Nobody knows if this fund was itself corrupted.

We have reached a point where the general public and organizations of commuters and Calabarzon firms should enter the picture. Otherwise, they will cook in the fat of government and foreign elements out to get a pie which they have to pay for.

Toll increases based on an P8-billion loan are estimated to hit P2.05 kilometer from P0.50 in mid-2006. For an P11-billion loan, tolls would increase to about P3.50 per kilometer and for P15-billion, up to about P5.00, staggering 1,000%. In other words, under the still-secret loan amount, not to mention the general public. In the NLEX, the Manila North Tollways Corporation, a Benpress subsidiary, (the PNCC of the north) is raking it in based on the same 1,000% toll rate increase. Let us not let the tragedy of NLEX happen to SLEX.

If PNCC is indeed guilty of corruption as shown in senate hearings on the Radstock deal, and if its financial situation right now is truly that bad which a PNB loan cannot rectify, PNCC obviously does not deserve a franchise renewal.

At the third and final hearing of the House committee on franchise, congressman suddenly came in full force for the voting when previous hearings were hardly attended. Why did they agree to such a questionable franchise renewal? That is the $64,000 question.

[nicolodeon]

Rumor has it that NLEX toll-rates would be increased as well by 30%. So if this pushes through, NLEX toll-fees from Balintawak to Bocaue and vice-versa would increase from P 38 to P 50. Allegedly, the objective behind the increase is to pay for past dues/outstanding loans of PNCC. Note: these loans are allegedly pre-MNTC era. If rumors are correct, the rate hike would take effect before June this year.

[FrankDrebin]

Away yan nic!

[GerardTagayty]

these corrupt people should be banished!!! lol OFF with their heads!!!! throw them to the lions!!! lol

[vhenok]

o di kaya itali sa puno then pahiran ng honey all over and hayaan sila papakin ng mga hantik

As usual, tayong mga road users o end-consumers ang sasalo lahat ng ito.

[creepy]

Rumor has it that NLEX toll-rates would be increased as well by 30%. So if this pushes through, NLEX toll-fees from Balintawak to Bocaue and vice-versa would increase from P 38 to P 50. Allegedly, the objective behind the increase is to pay for past dues/outstanding loans of PNCC. Note: these loans are allegedly pre-MNTC era. If rumors are correct, the rate hike would take effect before June this year.

The toll rates of NLEX are linked to (among other things) inflation and the Peso-dollar exchange rate using an automatic formula that's pegged until the year 2030.

So the toll rates could rise if the peso weakens.

[gearspeed]

Sabi na eh sa una magbaba then tataas na naman baka double pa..Isama na din nila yung most common na napapanood ko sa tv na sinasabi nila na "Wala po kaming magagawa kundi ipasama sa mga gumagamit ng NLEX ang pagtaas" which naririnig ko din parati sa mga gas stations na nagtataas.

[evs_13]

gggggrrrrrrrrrrrrrrrr!!!!

wala na ba sila magawa kundi magtaas na lang lagi ng toll fee?????

[shadow]

my question is isasara ba nila yun alabang viaduct? since meron ng bagong exit before alabang?

[CVT]

SLEX bros., brace yourselves.....

Heavy traffic and skyrocketing toll fees....

1801:fuzzy:

[metatron]

the government charges us for everything nowadays - the slex deal feels like the higher ups are authorizing pncc to charge us for worsening traffic.

[boybi]

afaik, NLEX's toll can only be adjusted once every 2 years. since nag adjust sila this dec-jan, sa 2009 pa dapat ang next adjustment. unless hindi considered adjustment ang pagbaba ng toll fee.

[niky]

AMF!!!!! Saw this post yesterday but I couldn't reply (naka-mobile)...

We're already paying more per kilometer from Alabang to Nichols than the boys on the NLEX... now we're going to pay the same for Calamba to Nichols? My toll fee from Mamplasan is already 79 bucks... If I'm going to be paying well over 100 pesos just to drive a measly 12-15 kilometers, I'll just lug it through traffic to the Coastal Road, thank you...

Argh. Time to get a BF Sticker...

[ryan17]

Guys, just an update:

MOTORISTS TO SUE PNCC (Bernardo V. Lopez, Business World, Feb. 21,2007)

The Road Users Protection Advocate (RUPA) is set to sue the Transportation Regulatory Board (TRB) and Philippine National Construction Corp. (PNCC), the franchise holder for the South Luzon Expressway (Slex), over a tollway contract which is predicted to result in toll rates increasing tenfold in the next five years.

This is beginning to smell like the NAIA-3 contract which the Supreme Court declared null and void for being disadvantageous to the government. Whether PNCC’s joint venture partner for the SLEX expansion, Malaysia Thai Development Corp. (MTDC), will be included in the court case is not known. The issue revolves around a provision in the Slex expansion contract under Section 2.03 of the Supplemental Tollway Operation Agreement (STOA),which states, “Moreover, regardless of whether or not the PNCC Franchise is renewed, the Concession granted to the investor and the Operator hereunder and this Agreement shall remain valid and subsisting in the event of a change in ownership of PNCC”.

In other word, the franchise holder can still operate the franchise even if it loses its franchise, which is ridiculous. All it has to do is effect a change in ownership, whatever that means.

RUPA claims the STOA is null and void because it was not signed by the President as provided by the STOA itself under Section 2.04, which states, “This Agreement shall come into effect upon the approval of this Agreement by the President of the Republic of the Philippines….”. RUPA says it was only signed by the TRB executive director Manny Imperial and PNCC chairman Art Aguilar.

The PNCC franchise expires on April 30 and there is no way for Congress to renew it with the special session having concluded February 20. However, it does not operate the tollway as explained above. The franchise will lapse, but franchise or no franchise, PNCC and its partner MTDC still operate the tollway.

RUPA, together with an array of motorist organizations and federations – bus, jeepney, truck, shuttle operators, homeowners’ association and Calabarzon chambers of commerce – is a force to reckon with. This force was able to pressure the TRB to suspend an increase in toll rates in the Alabang to Fort Bonifacio portion of the SLEX under the Citra franchise a few years ago. When people started stoning toll booths, the TRB backed down. We hope this does not happen in the protest against PNCC.

This huge motorist force wants the “STAR model” adopted in the Slex. The STAR expressway in Batangas offers cheap toll rates for the riding public because the construction of the expressway by the DPWH loan from Japan. Infrastructure construction, normally corruption-prone worldwide, should never be the onus of the riding public.

The PNCC franchise is corruption-prone because a franchise does not require a public bidding, which is a requirement for the DPWH. PNCC can unilaterally choose its contactor without oversight. In the STAR model, not only was there a bidding by the DPWH but construction was also not charged to motorists, only operations and maintenance.

The SLEX expansion comes from a World Bank IFC loan. The World Bank will have a bigger loan and bigger profits if it supports PNCC, which is doing. The World Bank says it will now give loan if PNCC does not get the franchise, say the motorists. It is therefore virtually supporting an entity being investigated by the Senate for corruption. Perhaps we should turn to the Japanese for the loan.

Meanwhile, the Senate has adopted Senator Franklin Drilon’s Resolution 618, directing the Committee on Finance to investigate the so-called “Radstock deal”. Virgin Islands-based Radstock Securities Limited, represented by Sonny Dominguez in the Philippines, is “an unknown business entity with a capitalization of only $50,000,” according to Senate documents. Radstock bought PNCC’s 50-million debt to Marubeni for $2 million.

The Senate hearings focused on a corruption issue involving PNCC and Radstock. Senators Drilon and Serging Osmeña questioned PNCC for suspiciously resurrecting an expired bad debt so that it could pay a stagerring P13 billion to Radstock with P10 million as attorney’s fees. According to Senate documents, Radstock and PNCC then entered into a compromise agreement for the latter to turn over assets worth of P6 million.

The assets were composed of “19 pieces of real estate properties, the bulk of which is 12.9 hectares in the Pasay City Financial Center…. 20% of the outstanding capital stock of PNCC… and 50% of the PNCC’s share in the gross toll revenue of the Manila North Tollways Corporation for 27 years.” MNTC grosses about P17 million a day, and Radstock’s share is a windfall that can easily dwarf real estate and equity acquisitions. If the Radstock deal is ruled illegal and null and void, all these billions may have to go into escrow and returned to PNCC, including MNTC toll income shares. That is, if they have not been somehow laundered. The Senate documents says the country stands to lose P36 billion owned by PNCC and P3 billion in taxes.

It is unfortunate that the “sins” of a handful can bring down the entire institution itself to the detriment of its many rank-and-file workers.

Let me quote a letter from motorists headed by RUPA, “Salamat po senators. Mabuti na lang po may Senado (Thank you senators. It is fortunate we have a Senate).” Otherwise, House Bill 5749 would have succeeded in making life difficult for the local economies of South and North Luzon.

[3sgTe]

basta ako susana to san pedro exit pa rin!!.. piso lang!haha!..

[freeloader]

Guys tomorrow after lunch pupunta ako ng Batangas, kumusta naman traffic sa SLEX? Is it worst?

[ryan17]

basta ako susana to san pedro exit pa rin!!.. piso lang!haha!..

If what mr. lopez says is true, get ready to fork out P10 soon.

[3sgTe]

Guys tomorrow after lunch pupunta ako ng Batangas, kumusta naman traffic sa SLEX? Is it worst?

moderate lang lagi.. except sucat and alabang area.. lalo na friday expect heavy traffic..

[3sgTe]

If what mr. lopez says is true, get ready to fork out P10 soon.

10php?! my god!.. sobra na yun...

[greenlyt]

10php?! my god!.. sobra na yun...

dati piso rin ang bicutan to nichols ngayon 30 php na!