Integrated Public Land Transport

System for Taguig City

PPP – BOT Solicited Proposal by LGU Taguig City
Project Approval Stage
GROUP 1
 Project Approval Stage (Solicited BOT)

ENDORSEMENT
AND Publication of
Project Proposal APPROVING
CONFIRMATION Invitation to
BODY
(Development Prequalify and to Bid
Council, ICC)

PROJECT PROJECT PARTNER

DEVELOPMENT APPROVAL SELECTION
STAGE STAGE STAGE

2
“JHEZ” Salvador ● “FAM” Medina ● “JEHAN” Sampao-Hassiman
 Project Approval Stage (Solicited BOT)
• Objective of the Approval Process
• Guidelines for Approval
Local Projects, project cost
Up to PhP20M
> PhP20M ≥ PhP50M
Up to PhP50M
> PhP50M ≥ PhP200M
> PhP200M
Approving Body = Local Sanggunian (Taguig City);
Need prior confirmation by
Municipal Development Council (MDC)
Provincial Development Council (PDC)
City Development Council (CDC)
Regional Development Council (RDC)
Investment Coordinating Committee (ICC)

• Recall: The proposed “IPLTS” project cost is estimated at PhP2B

3
“JHEZ” Salvador ● “FAM” Medina ● “JEHAN” Sampao-Hassiman
 Project Approval Stage (Solicited BOT)
• Detailed Guidelines for the Approval of Projects (2022 IRR, §2.10)
• The Approving Body shall be guided by the following:
Technical Criteria Financial Criteria
• Value for money analysis • Feasibility
• Competitiveness • Economic viability
• Social and environmental impacts • Operational costs
• Technical requirements • Cash flow
• Key performance indicators (KPI) • Firm payments
• Risk allocation (GPRAM)

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“JHEZ” Salvador ● “FAM” Medina ● “JEHAN” Sampao-Hassiman
 Project Approval Stage (Solicited BOT)
Deadline for Approval of Solicited Projects (2022 IRR, §2.11)
• Approve/disapprove within 30 working days from receipt of complete
set of requirements for evaluation
In case of APPROVAL In case of DISAPPROVAL
• The LGU-Taguig City will publish the • The Sangguniang Panlungsod of Taguig
“Invitation to Prequalify and to Bid” within City shall issue a Resolution citing the
six (6) month unless extended by the reason(s) for disapproval
Sangguniang Panlungsod of Taguig City • Resubmission of disapproved project may
(as Approving Body) be allowed, but it will be treated as a NEW
project under new timelines

5
“JHEZ” Salvador ● “FAM” Medina ● “JEHAN” Sampao-Hassiman
 Project Approval Stage (Solicited BOT)
LIST of Documents for ICC Review (published at NEDA website)
NOTE: LGU shall submit PTCs as part of the project for approval. (IRR, §2.8)
Obligations
Scope of the Project Contractual Arrangement Contract term Undertakings
Liquidated Damages

Requirement to submit Key performance indicators, Government Bid parameter that does not
performance reports targets, and measurement Undertakings deter competition

Requirement to disclose Ceiling for debt-to-equity Revenue share for the Reasonable Rate of Return
loan agreement (14.6) ratio government, if any (12.18)

Firm and contingent liabilities, risk

Proposed structure of Acceptable conditions for
Grounds for Termination allocation, materiality threshold
lenders’ step-in rights
tolls/fees/rentals/charges amount and/or compensation cap

Conditions for acceptable Condition prohibiting

permitted security interest onerous provisions

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“JHEZ” Salvador ● “FAM” Medina ● “JEHAN” Sampao-Hassiman
 Project Approval Stage (Solicited BOT)
LIST of Documents for ICC Review (published at NEDA website)
NOTE: LGU shall submit PTCs as part of the project for approval. (IRR, §2.8)
1. Specific contractual 2. Key performance
3. Implementation
arrangement, term, scope of indicators, targets, and
work measurement Milestones

5. Requirement to disclose
4. Cost recovery scheme loan agreement (14.6)
6. Liquidated Damages

7. performance security 8. Minimum insurance 9. Acceptance tests and

requirements coverage procedures

10. warranty period and 11. Grounds for, Effects of

procedures (after transfer) and
Contract Termination
12. Dispute Resolution
warranty security

13. Manner, procedures for the

14. Compliance with other
resolution of warranty against
corruption
laws, rules, regulations

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“JHEZ” Salvador ● “FAM” Medina ● “JEHAN” Sampao-Hassiman
 Project Approval Stage (Solicited BOT)
Approval of Draft Contract (§2.12)
Draft Contract
Based on PTCs
Should clearly define:
basic and legal relationships
rights and responsibilities
 specific gov’t undertakings
 obligations, undertakings of Project
Proponent
Review requirements:
Review by statutory counsel
Review, approval by LGU
“JHEZ” Salvador ● “FAM” Medina
Note: The contract cannot contain
terms that will result in:
Altering approved risk allocation
Conflict, supersede approved PTC
incremental fiscal impact being
disadvantageous to gov’t
altering definition of contingent
liabilities, expanding types of
contingent liabilities set by the
Revised IRR
Worsening approved viability
indicators from gov’t perspective
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● “JEHAN” Sampao-Hassiman
 Contractual Provisions (Solicited BOT)
Structure
Build-Operate-Transfer (BOT)
Role of Private Sector
• Finances and constructs the project
• Operates and maintains the facilities
for thirty (30) years
• Collects fees and charges to recover
investment plus profit
• Transfers the facility at the end of 30
years (cooperation period)
“JHEZ” Salvador ● “FAM” Medina
Role of Government
• Provides and/ facilitate securing the
appropriate land transport franchise
• Regulates the activities of the BOT
contractor
• Acquires ownership of the structures,
facilities, and the equipment at the end
of 30 years
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● “JEHAN” Sampao-Hassiman
 Contractual Provisions (Solicited BOT)
Risk Allocation
Risk Contract Provision
• Allocated to Private • The site is identified by the LGU of Taguig City and the
Sector (who will Private Partner initially acquires the site.
provide the site • The Public Partner shall be responsible in the
pre-identified by resettlement of informal dwellers.
the Public Partner • The Public Partner shall not be liable for any liquidated
(LGU of Taguig damages caused by delayed acquisition of the ROW.
City) • The site for the two transport terminals shall be made a
pre-condition to construction start date in the Notice to
Proceed.

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“JHEZ” Salvador ● “FAM” Medina ● “JEHAN” Sampao-Hassiman
 Contractual Provisions (Solicited BOT)
Repayment
Public Partner
• Shall receive an income of no less
than P10M per month from the Private
Partner for the operation of the
Integrated Public Land Transport
System
• An increase of P1M shall added for
every five (5) years of operation [at
least P15M/month at the start of 25th
year of operation]
“JHEZ” Salvador ● “FAM” Medina
Private Partner
• Receives all the income for the
operation of the IPLTS
• Fees for the use of the public
terminals
• Lease of commercial spaces
• Royalties for the use of mobile
apps pertaining to IPLTS
• Collections from identified parking
fees and towing services
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● “JEHAN” Sampao-Hassiman
 Taguig City Project Proposal

Project Approval Stage

ICC Secretariat

Project
Evaluation

ICC Technical
Board

ICC Cabinet
Committee

NEDA Board, ICC

Confirmation

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“JHEZ” Salvador ● “FAM” Medina ● “JEHAN” Sampao-Hassiman
 Project Approval Stage (Solicited BOT)
Guide questions:
• Why procure through PPP?
• Whether the scope of private sector’s participation is acceptable?
• Whether risks allocated to the government are acceptable?
• Whether the project structure is compliant with BOT law and its IRR?
• Whether the project terms are acceptable?

Lessons from the Past PPP Projects

• Submit complete documentary requirements
• Provide realistic assumptions for the project’s feasibility study and models
• Engage stakeholders for the evaluation of complex projects
• Avoid changes in the project terms

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“JHEZ” Salvador ● “FAM” Medina ● “JEHAN” Sampao-Hassiman
 Thank you!
Group 1 – Team LGU: “VIEN” Gabato ● “LYN” Dapul-Artazo ● “BOYET” Pasal ●
“JHEZ” Salvador ● “FAM” Medina ● “JEHAN” Sampao-Hassiman ● “LOTTE”
Sayson-Ables ● “SANDY” Sandialan-Mayasa ● “SAM” Tansingco-Parcon ●
“ROCHELLE” Cortez-Naz ● “LOUIE” Villanueva ● “LOLY” Aquino-Madduma