THE Department of Transportation (DoTr) needs to assign a higher priority to solicited proposals for modernizing Ninoy Aquino International Airport (NAIA), transportation experts said.
In a statement on Wednesday, think tank Infrawatch’s Convenor, Terry L. Ridon, said solicited proposals are more likely to consider the public interest.
“The public interest, particularly reasonable terminal fees, is as important as government revenue in public-private partnerships (PPPs) such as airport operations,” Mr. Ridon said in a statement on Wednesday.
“For context, the Manila International Airport Consortium’s (MIAC) revised unsolicited offer of $3.8 billion or P210 billion is almost 50% higher than the DoTr’s recent pronouncement that NAIA’s rehabilitation will cost around P141 billion,” he said.
“In order to properly reflect the public interest in NAIA rehabilitation proceedings, the Transport department should opt to proceed with a solicited bid and reject MIAC’s unsolicited proposal,” he added.
In a briefing last week, Transport Undersecretary for Aviation and Airports Roberto C.O. Lim said that the DoTr and Manila International Airport Authority’s joint solicited proposal submitted to the National Economic and Development Authority (NEDA) will serve as the baseline for the levels of investment the government expects for the airport’s modernization.
“If the private consortium has submitted an initial unsolicited proposal that is almost 30% less than the DoTr’s cost assessment, and thereafter submitting a more expensive amended proposal, it can only mean that both parties have entirely different perspectives on how the airport rehabilitation should proceed. But it is government that should decide with finality which rehabilitation areas should be prioritized,” Mr. Ridon added.
Mr. Lim said that the DoTr hopes to publish the invitation to bid and participate in the rehabilitation exercise by September.
The DoTr is waiting for the solicited proposal to obtain approval from NEDA before it talks to any private group.
“Competitive bidding ensures the best price for both the government and public, as future terminal fees will be dependent on the actual project cost after a winning bidder is selected,” Mr. Ridon said.
“This is unlike an unsolicited proposal in which terminal fees are ultimately dependent on the approved project cost of a project proponent. In the case of NAIA rehabilitation, a solicited bid should ensure cheaper terminal fees by at least 30% if DoTr’s P141-billion cost pronouncement holds,” he added.
Transportation expert Rene S. Santiago said that the unsolicited proposal will make the airport vulnerable to legal challenge.
“Solicited is the best option from a public policy standpoint. Also, most practical as unsolicited route is vulnerable to legal challenges that could derail NAIA modernization,” Mr. Santiago said in a Viber message.
In April, the MIAC, composed of Aboitiz Infracapital, Inc., AC Infrastructure Holdings Corp., Asia’s Emerging Dragon Corp., Alliance Global – Infracorp Development, Inc., Filinvest Development Corp., JG Summit Infrastructure Holdings Corp. and Global Infrastructure Partners submitted an unsolicited proposal for the rehabilitation of NAIA.
The previously submitted proposal involved a capital investment of P141 billion which includes the upfront payment to the government and committed investments in new facilities and technology. — Justine Irish D. Tabile