QuestionsQuestions (TRB)
The rules state that due to the huge financial requirements of government infrastructure programs, private sector resources should be tapped. Toll fees for use of certain public improvements may be authorized to allow a reasonable rate of return, but collection and operations by the private sector must be closely supervised and regulated in the public interest.
A TOC is an authority granted to a person or juridical entity to develop/improve/construct and operate and maintain a toll facility, with the facility turned over to government without cost at the end of the franchise period. The grantee must be Filipino citizens or a Philippine corporation/association qualified and authorized to engage in toll operations. The TOC has a fixed term not exceeding 50 years.
A TOC is issued by the TRB as an authority to the grantee. A TOA is a contractual arrangement where TRB contracts in behalf of the Republic with the private party; it is subject to approval of the President of the Philippines.
They may be amended, modified, or revoked whenever the public interest so requires, subject to TRB action and to the requirement of just compensation and/or the relevant section on revocation.
The grantee must desist from collecting toll upon expiration of the TOC/TOA, and the entire facility operated as a toll system (including all operation and maintenance equipment directly related to toll operations and maintenance) must be turned over to the government immediately upon expiration, without cost.
The grantee may not lease, transfer, grant the usufruct, sell, or assign rights/privileges or merge with another entity for the same purpose without prior approval of the President. Transfers must be recommended by the TRB based on compliance with prequalification requirements.
In time of war, rebellion, public peril, emergency, calamity, disaster, or disturbance of peace and order, the President may cause total or partial closing of the toll facility or order government takeover without prejudice to payment of just compensation.
PBAC executes, subject to Board approval, the aspects of prequalification, bidding, and award: preparation of bidding documents, publications, prequalification of bidders, pre-bid conferences, supplemental notices, interpretation of bidding rules, bid evaluation, dispute resolution between bidders, and recommendation for acceptance/award.
PBAC includes TRB staff and DPWH: Executive Director as Chairman; Legal Officer as Member-Secretary; designated technical and finance/management members; two private sector representatives as observers (non-voting); and a COA representative as observer (non-voting).
Bidders submit (1) a Technical Proposal envelope and (2) a Financial Proposal envelope, sealed and marked “Do Not Open Before.” At opening, PBAC opens only the first envelope, checks completeness and required bid security. If incomplete or without required bid security, the bid is automatically rejected and the second envelope is returned unopened.
Bid security is based on estimated cost of construction: e.g., not less than 2.0% for cost less than P5.0B; not less than 1.5% (at least P100M) for P5.0B–P10.0B; not less than 1.0% (at least P150M) for P10.0B and above. Its purpose is to guarantee that within seven (7) calendar days from Notice of Award the winning bidder will comply with award terms, accept the TOC/execute TOA, and furnish required performance security.
The first stage evaluates technical, operational, environmental, and financing viability: (1) Technical soundness vs minimum design/performance and engineering survey within +/-20%, feasibility of methods/schedules; (2) Operational feasibility; (3) Environmental standards compliance with DENR requirements and identification/mitigation of adverse effects; (4) Project financing viability meeting construction and O&M costs; and (5) enhancements offered to government.
Second-stage evaluation compares present values of proposed user tolls/fees/rentals/charges over the fixed term using discount rate and foreign exchange rate prescribed in bidding documents. The TOC/TOA is awarded to the bidder with the lowest present value.
The term is fixed and may not exceed fifty (50) years. At the end of the franchise period, the toll facility must be turned over to the government without cost.
ICC clearance is required when government appropriations or credit enhancements are more than P300 million. Purpose is to clear draft TOC/TOA on a no-objection basis, specifically on the extent and scope of government undertaking, and to review additional provisions different from earlier ICC approval if any.