Lavern D Clarke, Builders Forum Co-ordinator
NO CONSTRUCTION activity is likely on Government's super highway project before March, according to the latest information on the project, and funds raised from the infrastructure bond issue remain uncollected pending the passage of legislation giving sanction to a toll system here.
The first phase of the development is to proceed on a segmented basis, starting at Old Harbour, St. Catherine to dualise 12.7 km of the bypass just completed by the Kuwaitis expanding it from two to four lanes.
The National Roads Operation and Construction Company (NROCC), the entity set up to administer the Highway 2000 project, was still awaiting the final designs of the first leg of the roadworks promised by developers TransJamaican Highway Limited this week.
NROCC is looking at another six weeks from receipt of the plans to secure the approvals from the relevant Government agencies before the French contractors can get the official notice to proceed.
TransJamaican, the company set up by Bouygues Travaux Publics as vehicle for executing the 35-year concession agreement on the US$390m toll road, is also awaiting final word from the National Environment and Planning Agency in respect of the environmental safeguards it must implement on the Old Harbour segment which it will attack first.
Dr. Wayne Reid, executive director of NROCC, said Wednesday that the preliminary designs for the Old Harbour segment have been signed off on by the National Works Agency, with "certain technical conditions" that will be addressed in the final plans.
The work schedule includes construction on the Old Harbour Bay interchange, the development of six or seven bridge sites, and the dualisation. NROCC meantime is managing the land acquisitions along the full Mandeville-Kingston route, and seeing to the US$6m relocation of utility poles, and water and irrigation pipes.
TransJamaican will piggyback on the bypass' environmental impact assessment, and so had little work to do in that regard for this section of the project, according to Reid.
Tolling will be implemented as soon as the first 12.7 km dualisation is complete, but Reid refused comment on what the toll will be and the formula used in deriving it, only that it would be indexed to US inflation as loan financing for the highway was acquired in US dollars.
Expectations are that TransJamaican will proceed swiftly to complete the Old Harbour section of the highway, to start generating revenues from the road before the end of the calendar year. The entire phase one is to be built in 36 months.
Initially, all tolls collected will go exclusively to TransJamaican until the company exceeds a threshold 16 per cent return on equity. The company has put US$283m into phase one, while Government is providing US$107m.
NROCC officials are trying to fast track the crafting of the new toll act under which the highway maintenance and road fee will be administered. After several drafts, the Chief Parliamentary Counsel has passed it over for final comments before it goes before Parliament to be debated.
"It should have been done already, because it is holding up the bond," Reid told Builders Forum.
The agency needs the legislation passed quickly in order to collect on the $3.5b in infrastructure bonds it issued to the market late last year at a coupon rate of 4.5 per cent. The funds will finance Government's portion of the road cost, and provide working capital for NROCC.
Highway 2000 marks Jamaica's virgin entry into tolling and, according to Reid, investors won't pay up until the system is legally entrenched.
"The bond is based on a fact - that a toll road is being built, and that needs legislation." NROCC becomes the official 'Tolling Authority' once the law is enacted.
Reid optimistically gives the process one month to be completed, insisting that the legislation charts no new ground, but simply expands a function that Government previously held exclusively.
"There is nothing much to the law. It is now only saying that a private person can build a road and finance it, and that Government can collect on it," he said.
