Firms with pending cases won’t be allowed to join LRT 1-Ext bidding

MANILA, Philippines - The Department of Transportation and Communications (DOTC) has barred companies with pending cases against the government from joining the rebidding of the P65-billion Light Rail Transit line 1 (LRT1) Cavite extension project next month.

Lawyer Jose Perpetuo Lotilla, undersecretary of the DOTC, issued Special Bid Bulletin 01-2014 containing the amendments to the instructions to bidders for the Aquino administration’s largest public private partnership (PPP) project.

Lotilla said the agency inserted a provision in Section 13 of the instructions to bidders defining any outstanding dispute with the government.

Section 16.68 of the revised instructions defines outstanding dispute with the government as any pending judicial, administrative or alternative dispute resolution or blacklisting proceedings, between the bidder, any consortium member, their affiliates, or contractor proposed by the bidder of the consortium, on the one hand, and the national government, any of its offices, agencies or instrumentalities, or any government-owned or controlled corporation.

The dispute, the agency added, could arise out of or in connection with any bidding project or contract of the national government, any of its instrumentalities or any GOCC intended to provide a critical basic necessity and of paramount public interest and importance.

The DOTC said such dispute might be an impediment to the successful implementation of the PPP project.

The agency has given interested bidders until April 28 to submit their bids for a single-stage bidding wherein interested groups would submit their qualification documents simultaneously with their technical and financial proposals to shorten the process by at least two months.

It would be recalled that the DOTC and the Light Rail Transit Authority (LRTA) declared a failed bidding after only one of the four prequalified bidders – Light Rail Manila consortium led by infrastructure giant Metro Pacific Investments Corp. (MPIC) – submitted a bid last Aug. 15 while other major proponents backed out due to concerns about the viability of the project.

Only the Light Rail Manila consortium minus Ayala Corp. submitted a conditional bid while MTD-Samsung Group, San Miguel Infrastructure of diversified conglomerate San Miguel Corp. (SMC), and DMCI Holdings withdrew from the process due to concerns including on who would shoulder the real estate taxes.

Companies that are set to join the rebidding include Ayala Corp. and MPIC through the Light Rail Manila consortium, SMC Infra, DMCI Holdings, Malaysian-owned MTD Philippines Inc., Ecorail Transport Service Inc. of businessman Reghis Romero II, Globalvia Inversiones of Spain, and Megawide Construction Corp.

The National Economic and Development Authority (NEDA) Board chaired by President Aquino approved last Nov. 21 the revised terms for the project including the payment of real property taxes (RPT) by the government, ensuring the integrity of the facility’s structure for a two-year period, approving a five-percent fare increase upon completion of the project, and allowing the submission of negative bids.

However, the cost of the project went up to P64.9 billion from P60 billion due to additional components that were originally intended to be pursued as separate projects but was included in the project to make it more robust.

The additional components include some remedial and rehabilitation works for the existing system such as repairing the carriage viaduct, rehabilitating existing trains especially their roofing, as well as making the LRT1 system compliant with laws and regulations.

Other components include the installation of equipment that would be part of the common ticketing system that is also being auctioned by the DOTC.

Other components include contingency costs, on account of the interface risk with related projects such as the AFCS PPP, the construction of the common station linking LRT-1 with MRT Lines 3 and 7 in the EDSA-North Ave. area, and the LRT-1 Cavite extension project components procured under the project’s official development assistance (ODA) portion.