Jumping the Hurdles: A South African Toll Road Experience

1. JUMPING THE HURDLES A South African Experience by Leo Rohrig CEO : Bakwena Platinum Corridor Concessionaire IBTTA PHILADELPHIA 2004

2. OBSTRUCTIVE ANTI TOLL FORCE Misguided greenies SCORPIONS Publicity hungry politicians Irritated housewives SNAKES Minister of Transport Lawyers IBTTA PHILADELPHIA 2004

3. SOUTH AFRICAN ROADS • Funding back-log : $ 10 bill • 20 % surfaced network : 65000 miles • Toll Roads 2.5 % 1600 miles • Government toll roads : 780 miles • 3 Concession toll roads : 820 miles IBTTA PHILADELPHIA 2004

4. BAKWENA : KEY FEATURES • Initial Project value - $ 500 million • Length of road – 245 miles • ADT : 150000 vehicles through 15 plazas Sticky component : National Road maintained by state Part of urban commuter grid Used but not tolled for past 20 years Capacity exhausted, no funds for upgrading Logical solution : convert to Toll Road IBTTA PHILADELPHIA 2004

5. THE HURDLES • 1 AUTHORITIES IN TWO MINDS • 2 ENVIRONMENTAL CHALLENGES • 3 TOLLING AN EXISTING HIGHWAY • 4 PROTESTOR ACTIONS • 5 PRIVATE FUNDING LIMITATIONS IBTTA PHILADELPHIA 2004

6. 1“ YES ... BUT “ AUTHORITIES YES : New funding priorities Small allocations for infrastructure Economy depends on roads Tolling declared policy of government BUT : No tolls for the poor Discounts for the deserving Toll-free alternative routes Ambiguity fuels objections IBTTA PHILADELPHIA 2004

7. 1‘ OFFICIAL AMBIGUITY ’ The State President : “This investment will include key economic infrastructure projects such as …. the John Ross Highway ……….” The Minister of Transport : ….. then cancelled the project within days of its scheduled implementation Lobby government at every level IBTTA PHILADELPHIA 2004

8. 2ENVIRONMENTAL PROBLEMS • Environmental legislation often vague • Assessment process cumbersome • Detailed regulations missing • Authorisations can & will be challenged • Bio-physical AND socio-economic issues mixed IBTTA PHILADELPHIA 2004

9. 2ENVIRONMENTAL OBJECTIONS • Legal challenge on process compliance • Legal challenge on authorisation • Enhanced media mobilisation • Enforced objector’s participation • Commercial interests covered by green umbrella • Forced investigations into ‘ Alternatives ‘ Result : Substantial delays Increased costs IBTTA PHILADELPHIA 2004

10. 2 ENVIRONMENTAL : RESPONSE (1) Preventive : conduct EIA earliest possible eliminate alternatives viability mitigation options involve objectors Reactive : eliminate bio-physical issues meticulous process compliance Show-up legislation abuse IBTTA PHILADELPHIA 2004

11. 2 ENVIRONMENTAL : RESPONSE (2) ... intensify media feed-back prepare for court action – or strike a deal : plaza naming rights advertising near the highway dedicated access e-tag sales outlets Commercial issues prevail over green one’s ALLOW FOR EXTRA TIME & COST IBTTA PHILADELPHIA 2004

12. 3ANTI-TOLL CAMPAIGNS FLYERS & PAMPHLETS PROTEST MEETINGS DISRUPTIONS OF INFO MEETINGS MEDIA: Television Radio Press DEMONSTRATIONS Common Characteristic : FEW FACTS – PLENTY EMOTION IBTTA PHILADELPHIA 2004

13. 3 ANTI-TOLL : RESPONSE (1) • Accept : concessions are quite complex Funding, Financing, Design, Construct, Operate, Maintain & Upgrade • Dissect into comprehensible components • Embark on step-by-step information campaign • Road shows • Media presentations • Pamphlets • TV, radio interviews IBTTA PHILADELPHIA 2004

14. 3 ANTI-TOLL : RESPONSE (2) • Explain the life cycle of a road • Explain the changes in road funding • Focus on need for tolling : non-negotiable • Deflect hostility towards political realm • Be pro-active : organise info meetings • Be PATIENT, retain constructive attitude Logic is on your side – face any debate BE TRANSPARENT & INFORM, INFORM IBTTA PHILADELPHIA 2004

15. N1 Pretoria10km N1 Pretoria10km OUR CHOICE IBTTA PHILADELPHIA 2004

16. 4 DEMONSTRATIONS • Require authorisation, hence known Influence timing > outside traffic peaks • Arrange for discreet police presence • Observe unobtrusively • Avoid confrontation • Remain available to media • Feed traffic-related positive news Objective = make them ‘non-events’ IBTTA PHILADELPHIA 2004

17. 4PASSAGE OBSTRUCTIONS Out-of-sight response to threats Emergency services, tow-trucks, police Defuse emotion 4/5 days introductory toll-free passage super-friendly attendants hand out info flyers / business cards RELY ON NEXT DRIVER’S IMPATIENCE IBTTA PHILADELPHIA 2004

18. 4 IN-LANE FUNNIES Coinage Media release on “ legal tender “ Pre-packed change Alternative payments Live scorpions & snakes senior presence to back-up collectors capture evidence, threaten action BE PREPARED FOR THE ODDBALL IBTTA PHILADELPHIA 2004

19. Scorpion Python IBTTA PHILADELPHIA 2004

20. 5 PRIVATE FUNDING LIMITATIONS • Toll-viable corridors limited • Private funding depends on viability • Future schemes need increased government participation to lever private sector input • Equity holdings • Subsidies • Guarantees Public-Private-PARTNERships IBTTA PHILADELPHIA 2004

21. SUMMING UP • Lobby government @ every level • Clear all environmental issues • Be transparent • Conduct detailed information campaign • Defuse physical actions • Target genuine PPPartnerships IBTTA PHILADELPHIA 2004

22. 3 CONCESSIONS ADDED VALUE • Construct / upgrade 820 miles National Road • Average Daily Traffic 215000 vehicles • 29 Plazas with 223 lanes • Electronic Toll Collection introduced • 13300 new jobs created • $ 20 mio for community upliftment …. makes jumping the hurdles worthwhile ! IBTTA PHILADELPHIA 2004

23. THE ( familiar ) End IBTTA PHILADELPHIA 2004