Expressway project winner to get P5-B subsidy, gov’t says

The government will extend a P5-billion cash subsidy to the winning bidder of the 47-kilometer Cavite Laguna Expressway, in line with recent moves to make its public private partnership deals more attractive to the private sector.

Cosette Canilao, executive director of the PPP Center, said in an interview last week that the amount would partly cover a potentially contentious real property tax (RPT) payment.

The Department of Public Works and Highways, which is implementing the expressway project, had said the concessionaire would shoulder the tax, but some bidders raised concerns given that the Cavite Laguna Expressway was a greenfield project with initially “low” traffic projections.

The government has eased the RPT requirement for other PPP deals like the P64.9-billion Light Rail Transit Line 1 (LRT-1) extension to Cavite, which will be bid out in the second quarter next year, and the P17.5-billion Mactan-Cebu International Airport deal, which drew seven bidders last week.

“We approved the cash outlay subsidy of P5 billion,” Canilao told Inquirer. “So the RPT [real property tax] has already been taken into consideration.”

The tax is just one component taken into consideration for the P35.4-billion toll road, for which four groups were pre-qualified by DPWH late last month.

The four groups are consortia led by the Ayala and Aboitz Groups, San Miguel Corp., Metro Pacific Tollways Development Corp. and Malaysia’s Alloy MTD, the only international bidder.

Except for Aboitiz, these same companies have expressed their interest in the LRT-1 extension deal to Cavite.

The bid submission for the Cavite Laguna Expressway, meanwhile, has been set on Jan. 20, but if some bidders will have their way, this could be pushed back, DPWH undersecretary Rafael Yabut said in a previous interview.

The Cavite Laguna Expressway aims to decongest traffic along the Cavite-Laguna road network and reduce travel time to and from Metro Manila.

It will start from the Manila-Cavite expressway in Kawit, Cavite, and end at the South Luzon Expressway-Mamplasan Interchange in Biñan, Laguna.