MRTC, Sumitomo eye MRT-3 rehab

The MRT Corp. (MRTC), owner of the Metro Rail Transit Line 3 (MRT-3), is willing to infuse $150 million to rehabilitate the glitch-prone rail system, officials said.

MRTC president Frederick Parayno said Sumitomo and the MRTC discussed an action plan to rehabilitate the MRT-3 that has been formally and separately proposed to President Duterte and Transportation Secretary Arthur Tugade.

Sumitomo is the Japanese maintenance contractor that designed, built and maintained the MRT-3 system for 12 years or until 2012 without major glitches.

Parayno said Sumitomo is willing to return as the maintenance provider of MRT-3 if hired by MRTC.

Under the build-lease-transfer agreement between the government and MRTC, it is the latter’s right to choose and hire the maintenance contractor for the MRT-3.

The responsibility of hiring the maintenance contractor was taken by the Department of Transportation (DOTr) during the term of former secretary Joseph Emilio Abaya when it refused to renew the contract of Sumitomo and instead hired PH Trams without bidding but through a negotiated contract.

After it was mired in controversies over its poor performance, including failure to purchase spare parts, PH Trams was replaced by two other firms, including Busan Universal Rail Inc.

Busan’s contract was also cancelled earlier this month following numerous train breakdowns.

Abaya and other former transportation officials were earlier charged with plunder before the Office of the Ombudsman.

Parayno said MRTC can rehire Sumitomo and fix the MRT-3 without stopping operations if the DOTr will allow it.

The MRTC’s rehabilitation plan will include a full inspection of the MRT-3 to be completed within 30 days by 100 engineers, the purchase of $50 million worth of spare parts, replacement of broken rails, and the complete overhaul of all 73 cars of MRT.

Parayno said the rehabilitation can be completed by Sumitomo, all while the trains continue to be operational, in as soon as 26 months from the beginning of the rehabilitation program.

He said the MRTC is willing to advance $150 million for the rehabilitation of the trains, to be recovered later only through fares, even without increasing fares beyond the rates of air-conditioned buses.

Parayno recalled how well the MRT-3 functioned while under the maintenance of Sumitomo.

He said Sumitomo was effective as a maintenance provider because it was religious in the purchase of spare parts for MRT-3. It also left $15 million worth of spare parts when its contract was terminated by former transportation officials.

“There is no other cause for the damage to the trains but the incompetence and failure of the succeeding maintenance providers to procure spare parts,” he added.

Senators Grace Poe and Joseph Victor Ejercito, chair and vice chair of the Senate committee on public services, also backed the return of Sumitomo.

“They (Sumitomo) have the track record and it’s a reputable Japanese company. Sumitomo will not allow its name to be tarnished,” Ejercito said.

http://www.philstar.com/headlines/2017/11/27/1762923/mrtc-sumitomo-eye-mrt-3-rehab

Poe: Prioritize emergency powers for President to solve traffic woes

Senator Grace Poe called on Malacañang yesterday to certify the proposed emergency powers for the President as urgent for its immediate approval and enactment by Congress.

Poe, who filed Senate Bill No. 1284, an act compelling the government to address the transportation and congestion crisis through the grant of emergency powers to the President, said the fastest way the country’s traffic problem can be resolved is for the Palace to issue a certification declaring the measure a priority.

With only three weeks left before Congress adjourns for the holiday break starting December 16, the senator said the government should rush consideration and approval of the emergency powers bill to solve and fast track the implementation of projects aimed at overhauling key transport systems, particularly the Metro Rail Transit (MRT-3), to ease the traffic.

“Siguradong gagalaw ang emergency powers kung gagawin ng Malacañang na prayoridad ito at sesertipikahan para rin makatulong sa mabilis na pagpapatupad ng mga proyektong magpapaginhawa sa trapik, (I’m sure the emergency powers bill will move fast if Malacanang certifies it a priority so it can help enforce projects aimed at solving the traffic problem fast),” Poe said in a statement.

She said her committee recently met with officials of the Departments of Transportation (DOTr) and of Public Works and Highways (DPWH) and the Metropolitan Manila Development Authority (MMDA) to request the submission of their respective concrete plans to the plenary after tax reform and budget deliberations conclude.

All three agencies, according to Poe, have vowed to submit a comprehensive report on priority projects that will be implemented during the duration of the emergency powers before the session break.

“A certification of urgency will allow Congress to pass the measure on second and third reading within the same day,” she said, adding that a Palace certification is one way of compelling lawmakers to proceed with the bill.

Poe pointed out that it was President Duterte who first floated the idea during his first state of the nation address (SONA). But the topic was no longer mentioned again during his second SONA.

Once the President declares it as urgent, Poe said she is confident it would be taken as an imprimatur to prompt, not only the Senate leadership, but also for the House of Representatives to include the emergency powers bill in its priority agenda.

https://news.mb.com.ph/2017/11/27/poe-prioritize-emergency-powers-for-president-to-solve-traffic-woes/

Manila’s fountains restored in time for Christmas

The City of Manila under Mayor Joseph Estrada has successfully restored and renovated several fountains, which the previous administration had left neglected, in time for the expected increase in the number of local and foreign tourists during the Christmas season.

Estrada said the fountains, equipped with colored lights, provide added attractions to Manila’s tourist spots, especially at nighttime.

“Christmas is the time of the year where people go out with their families and loved ones, and many tourists will come and have a vacation here, not to mention the Christmas shoppers,” the Manila mayor said, “so this is why we have renovated our fountains and public parks.”

The fountains have been beautifully restored that it attracted not only weary spectators and travelers, but also people who want to cool down by plunging into them which the city government does not tolerate, according to Arsenic Lacson, Jr., officer-in-charge of the Manila Parks Development Office.

“Ang problema natin ngayon, nililiguan. Mayroon pa ngang naglalaba (Our problem is that they take a bath here. The also do their laundry),” Lacson, however, lamented.

MPDO is tasked to maintain and spruce up fountain plazas and public spaces, side streets and center islands, and historic monuments.

Eight such fountains have been renovated and beautified by the city government. These are located at the Raja Sulayman Park, Remedios Circle, Sta. Cruz Plaza, Plaza Gomburza across National Museum, Plaza Balagtas, Plaza San Lorenzo Ruiz, Plaza Hernandez, and at Mehan Garden, according to Lacson.

The MPDO is also pushing for the rehabilitation of two more fountains in Plaza Calderon near Sta. Ana Church.

“During the time of Mayor Lito Atienza, all the parks look beautiful. When Lim entered, that’s the time it was neglected. Fountains were not working),” Lacson pointed out.

“Fountains instantly beautify a place. And when the place is beautiful, clean and maintained properly, it attracts tourists, boosts businesses, and generates jobs. The development of our parks is an instant visual testament to the city’s development and prosperity,” Lacson said about the continued efforts of regaining the splendor of Manila’s public recreation spaces.

In line with his urban renewal agenda of restoring the lost glory and grandeur of Manila, Estrada has ordered the renovation of the capital city’s cultural and heritage parks, including the fountain plazas, and allocated P100 million for this purpose.

Once known as the “Pearl of the Orient,” Manila has 48 parks and monuments -  all that remained of the old Manila’s pre-war and colonial architecture. A number of these have been converted to children’s playgrounds.

Among the parks and plazas that underwent major facelift as per Estrada’s directive are Plaza Rueda and Bonifacio Shrine along Taft Avenue, Plaza Hernandez in Tondo, Plaza De Virge in Pandacan, Plaza Hugo in Sta. Ana, and Plaza Guerrero across the US Embassy, among others.

Recently, MPDO has inaugurated the newly renovated Plaza Oliva Salamanca at Taft Avenue in Ermita, which was named after Dr. Olivia Salamanca, one of the country’s first female doctors. She died in 1913 at the age of 24.

From pAbaya to TuGrabe

No, I didn’t think up that headline. I saw it as a hashtag on social media. Filipino humor can be devastating during difficult times. Unfortunately for whoever is the transport secretary, they are only as good as the performance of the MRT3.

MRT 3 had long been falling apart, but lately, it seems things are getting intolerably worse. The past and present transport secretaries have been nibbling at the periphery of the problem…as if rearranging deck chairs on the Titanic.

Both of them, pAbaya and TuGrabe are lawyers so they should know it all starts with the Original Sin: the MRT 3 BLT contract entered into by the FVR administration. It had been revised by succeeding administrations. After all the financial gymnastics, the Sobrepena-led MRTC still owns the system.

What has been sold to the financial market are MRT bonds representing 77 percent of the securitized future monthly rental payments for Phase 1 of the MRT 3 project and excludes any economic interest in other aspects of the MRT3. This was what government bought through DBP and LandBank.

The GFIs bought their MRT bonds at a big discount to face value. Market perception of the credit worthiness of the bonds may have been tarnished by the delayed lease payments.

Around 2007-2009, there were periods when the then DOTC was almost one year in arrears.  DOTC also neglected to set up the standby L/C in PNB which was supposed to be the cure for late payments. The last tranche of the bonds will mature on 2025, or the end of the lease period.

Since government banks hold 80 percent of total outstanding bonds, it is like paying from one government pocket to another to some extent. But Sobrepena’s MRTC retains ownership. As owner of the system, it is the responsibility of MRTC to maintain MRT 3 and make capital investments such as new trains.

But as it happened, Mar Roxas and his successor, pAbaya unilaterally took over the maintenance responsibility and awarded a contract to replace Sumitomo. Then pAbaya went on to award the P3.8 billion contract for new trains to a Chinese supplier.

MRTC claims the transportation department did all those in violation of their contract. MRTC also claims they tried to talk to both pAbaya and TuGrabe, but both refused.

I can understand why a government official will try to avoid having to deal with Sobrepena. I would too. The guy has a terrible track record in business, from the College Assurance Plan fiasco, Fil-Estate and Camp John Hay.

Perhaps the reason Mar Roxas ruled against Sobrepena is because MRTC has not kept their side of the bargain. I am told that maintenance, even under Sumitomo, had deteriorated just before the contract was cancelled.

But, as I said, there is no escaping the need to deal with MRTC. Ignoring MRTC means they will be indefinitely tied up in litigation while commuters suffer.

The MRT 3 contract has provisions for international arbitration of disputes. Indeed, there is a pending arbitration case in Singapore that needs to be cleared.

The only other thing government can probably do is to expropriate the system in the public interest. They can argue forever about the just compensation, but in the meantime, government can ask another group to invest and fix the system.

But such a drastic move will unnerve investors who will now worry about the sanctity of contracts with government. Doubts will likely affect investor attitude on everything else having to do with risking capital here.

We lost an opportunity to amicably fix the problem during the watch of Mar Roxas. At that time, Sobrepena had an agreement with Manny Pangilinan to make a joint proposal. Manny will pour in the needed investments, fix the dilapidated system and charge a fare competitive with aircon buses running at-grade. P-Noy reportedly commented that MVP may get too rich and that was the end of it.

Now, I understand the deal between Sobrepena and MVP is no longer operative. MVP made an independent unsolicited bid together with Ayala (part of the original MRT 3 consortium) and the transport department gave it original proponent status.

The proposal involves an investment of P12 billion to rehabilitate the train system without any fare increase for at least two years, as well as the handling of operations for a period of 30 to 32 years. It also includes resolving issues on the MRT-3 including the buyout of the government’s stake held by LandBank and DBP, as well as other shareholders in MRTC or the private owner of the train system.

But MRTC, as the owners of the MRT-3, now wants to reassert their rights. They claim they can rehire Sumitomo and fix the MRT-3 system without stopping operations, if DOTr would allow them.

MRTC claims they have submitted several letters to Transportation Sec. Art Tugade and President Duterte as early as February. But they got no response.

The rehabilitation plan of MRTC will include a full inspection of the MRT to be completed within 30 days by 100 engineers, the purchase of $50 million worth of spare parts, replacement of broken rails, the complete overhaul of all 73 MRT cars.

MRTC has, likewise, expressed willingness to advance the $150 million for the rehabilitation of the trains, to recover later only through fares, even without increasing MRT fares beyond the rates of air-conditioned buses.

Trusting Sobrepena to perform or even have the financial capacity to carry out his proposal is another thing altogether. It may be cheaper for President Duterte to talk to him, appeal to his sense of patriotism and when everything fails, to threaten him with Tokhang. 

As unpalatable as dealing with Sobrepena can be, he has to be dealt with or no lasting solution is possible and MRT 3’s problems will just worsen. That will be TuGrabe.

http://www.philstar.com/business/2017/11/27/1762696/pabaya-tugrabe