PAMPANGA, Philippines — The decision to raise toll rates for Luzon’s major expressways will likely be up to the next administration, with regulators having a hard time to decide what a “just and reasonable” fee would be.
“In toll petitions, we consider if it is just and reasonable. That’s the most difficult part. What’s holding us back is the Francisco decision, [which] made the work very difficult,” Alberto Suansing, consultant for Toll Regulatory Board (TRB), told reporters on the sidelines of an event last Friday, March 18, at the Royce Hotel and Casino in Clark, Pampanga City.
It was during its last decision to review toll hike in 2012 when the Supreme Court added a clause that new rates must be “just and reasonable.”
The TRB is evaluating the bid of the operators of the North Luzon Expressway (NLEX) and Manila-Cavite Toll Expressway (CAVITEX) to implement a 15% and 25% hike, respectively, in the fees they collect from motorists.
It has been over a year when the toll operators filed their petition in December 2014. TRB has not approved a toll fee hike just yet, but the petitions were not dismissed outright.
Toll road operators Cavitex Infrastructure Corporation and Manila North Tollways Corporation (MNTC) had said the rate adjustments should have been made as early as 2012.
A similar toll hike petition from MNTC for the Subic-Clark-Tarlac Expressway (SCTEX) has also been pending at the TRB since 2012. (READ: Metro Pacific eyes P5B NLEX expansion)
But for Suansing, the “just and reasonable” clause is “hard to determine.” “What may be just and reasonable to you is not just and reasonable to me.”
Without the clause, “we would have granted the requests of operators for toll hike,” Suansing added.
Asked if it will be able to decide before President Benigno Aquino III steps down, the TRB consultant replied: “I don’t think so. We don’t have the material time to release it. Probably it would go to the next administration.”
Operators: It’s hurting our pockets
But the delays in rate adjustments are turning off operators that had made plans of upgrading and rehabilitating expressways.
“It has been costing us some P3.5 billion foregone revenue as of end-January for NLEX; and another P800 million foregone revenue for CAVITEX,” Metro Pacific Tollways Corporation (MPTC) President and CEO Rodrigo Franco said on the sidelines of the event.
Cavitex Infrastructure and MNTC are both under MPTC. (READ: NLEX-SCTEX link ready for Holy Week)
Franco had said that both NLEX and CAVITEX have not had a toll hike since 2012, although their concession terms call for periodic adjustment.
“We followed the terms of our concession when the formula called for reduction of toll rates in 2007 and 2009. As a result of these rate reductions, our toll rates now, exclusive of value added tax, are lower than the toll rates when we opened the new NLEx in 2005. Now that the concession requires an upward adjustment of toll rates, the regulatory approval is hard to secure,” Franco had said.
According to Franco, the TRB was scheduled to decide on March 13 this year, but wanted a 30-day extension.
“It’s a request. I’m not saying we are agreeing to grant the request. As far as we’re concerned, we’re ready to file our arbitration case,” Mr. Franco said.
The arbitration case, which could take a year, will be filed before the United Nations Commission on International Trade Law.
The TRB in December 2014 said in a bid bulletin that the CAVITEX operator has proposed the following hike in toll rates:
- Class 1 vehicles including cars, jeepneys, pickup trucks and vans, to P27 from P22;
- Class 2 vehicles, including two-axle trucks, buses and vans, to P54 from P44; and,
- Class 3 vehicles, including trucks and trailers with three or more axles, to P81 from P66.
The operator of NLEX, meanwhile, has also proposed the following rates, exclusive of value-added tax:
- For open system or per entry: Class 1 should be P46.811343; Class 2 (P117.028356); and Class 3 (P140.434028); and,
- For closed system or per kilometer: Class 1 should be P2.741807; Class 2 (P6.854518); and Class 3 (P8.225422). — Rappler.com