1 portfolio committee on transport tuesday 09 march 2010 briefing on bus rapid transit system (brt)...

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Portfolio Committee on Transport Tuesday 09 March 2010

Briefing on Bus Rapid Transit System (BRT) Project

implementation in South African cities: Phase 1

Progress Update

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CONTENTS

1. Progress in implementing Catalytic Projects: Integrated Public Transport Networks

2. Way Forward

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Catalytic projects – Progress – IRPT Networks

Short-term (2009-2011) Joburg, Cape Town & Tshwane planning full BRTs as part of long-term IRPT networks.

Nelson Mandela Bay planning a partial BRT as part of a citywide

network.

ALL BRTs need to include existing directly affected operators & labour on contract as per NLTA

Other cities are in progress with Phase 1 IRPT network Operational Plans as base for full networks.

Need more interaction between cities & PRASA - joint planning of Priority Rail Corridors & feeders as part of IRPTN.

Inter-modal Planning Committees must be established

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Catalyt ic projects – Progress Status of Planning & Implementation in 12 cities

Johannesburg – Rea Vaya

Cape Town - Integrated Rapid Transit

Nelson Mandela Bay– Integrated Public Transport System

Tshwane

Other cities

City of Johannesburg

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Johannesburg - Starter BRT ServiceGood points of IRPTN to date – Rea Vaya

Positive response from commuters & general public Excellence in many areas: customer support staff, security

teams, station design, & system branding Stations represent a high-quality effort Stations appear well maintained & cleaned throughout day Mostly high standard of infrastructure Contract negotiations with Phase 1A operators well

advanced Rea Vaya branding identity well-developed & executed The branding livery for the Rea Vaya vehicles is

particularly creative & has done much to support system identity

Rea Vaya Going Forward

• Phase 1A:– Introduce feeders in phases

on 1 March and 1 May– Event service during 2010– Will then have 143 buses in

operation and 30 stations– 12 April is target date for

formation of BOC– Plan transition period with

‘shadow management’– EMV compliant AFC to be

implemented from October 2010

• Refined Phase 1B:– Revised route from Noorgesig,

Westbury, UJ, Wits, Metro Centre, Rissik street (no North route)

– Construction will only be completed by August 2011

– Affected operators include Metrobus, Putco and mini-bus taxi industry

– Will soon begin to work on new model including in respect of bus procurement and negotiations

Further phases will rely on new sustainable source of public transport funding

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Rea Vaya and the Taxi Industry...1

The Rea Vaya is set to affect the taxi industry positively - becoming the owners and operators of the first contracted bus operating company

Detailed consultation has been taking place with industry representatives - particularly the minibus taxi industry.

Negotiations with affected operators began in August 2009 and is nearing completion

There will then be a hand over and transition phase from the temporary bus operating company to an ex-taxi owned company

In January 2010, a Participation Framework Agreement was signed which sets out how operators who are affected will become beneficiaries and shareholders of the new bus operating company

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Rea Vaya and the Taxi Industry…2

There is almost full agreement on the contents of the Bus Operating Contract which sets out how the Company will operate the services prescribed by the City. The Bus Operating Contract has a number of innovative clauses including penalties if bus drivers does not drive safely or if the company does not maintain and clean the buses regularly. There are still some issues under negotiations and once agreement is reached, a final agreement will be signed. The City is also discussing with the negotiating team of affected operators a smooth transition and hand over period once agreement has been reached to ensure ongoing level of services especially as new routes are introduced and provide a service during the 2010 Soccer FIFA World Cup.

Rea Vaya will be ready to transport 20 000 spectators to both Ellis Park and Soccer City on match days

The COJ is working speedily to complete the two stations at Soccer City. The one station is on top of the Soweto Highway and pedestrians will have to travel by the longest man-made tunnel in Joburg under the freeway into the North side of the Stadium

53 buses will be utilised The Soweto to Ellispark corridor will be fully

operational on non match days

Rea Vaya and 2010 Soccer World Cup

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1. Need to ensure all affected operators can still join.2. Requires sustained support for enforcement and to maintain

safety and security of Rea Vaya3. Conclusion of Phase 1A negotiations & signing of BRT Operating

Company Contract.4. Improved governance & regulation of mini-bus taxi industry to

ensure stability & integration between Rea Vaya & other modes5. Enabling environment to ensure success i.e. community

engagement & mobilisation in support of public transport6. Appointment of dedicated staff to Contracting Authority.7. Network expansion to cover Soweto etc.8. Funds to complete Phase 1B infrastructure

Johannesburg BRT Challenges

City of Cape Town

Cape Town Integrated Rapid Transit (IRT)Progress as at end February 2010.

High quality dedicated roadways and stations on first leg (CBD to Bay Side) nearing completion.

First BRT-related contract in South Africa concluded with company representing inner city taxi industry: vehicle services for World Cup using IRT infrastructure.

Two IRT posts recently advertised to lead dedicated IRT project office: IRT Implementation; and IRT Operations.

In view of new funding allocations:

Detailed operational plan review underway to determine most effective project roll-out.

Updated business plan in preparation.

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Cape Town Integrated Rapid TransitProgress: Finances and tenders

Funding needed to complete Phase 1a is substantially provided for in the new DORA allocation.

Provision in DORA now allows for funding to be committed into future years – will assist implementation.

R668m construction tenders awarded. Further contracts tendered but not awarded, awaiting funding:

Infrastructure: Another R1bn; Fare system and control centre: R500m

Tenders for control centre equipment & management, fare management evaluated and ready to be awarded.

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1. Engagement with 8 taxi associations and 2 bus companies to transform them into 2 IRT Vehicle Companies.

2. A comprehensive compensation model developed, giving effect to the promise that taxi industry “will not be worst off”.

3. Since Nov 2009, focus shifted to negotiating contract for the 2010 World Cup service using IRT and other vehicles.

• In Feb contract signed with taxi company holding 75% of the existing inner city public transport market.

4. Consultation and negotiations will resume after review of system plan and business plan concluded, Apr / May.

Cape Town Integrated Rapid TransitProgress : Engagement with Taxi Industry

Cape Town IRT and WC 2010Status – Implementing Phase 1a

IRT implementation postponed to post World Cup

Negotiated 2010 contract with Company A -First service: 6 Feb

2010

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1. Need SARS directive on whether VAT is payable re dedicated BRT infrastructure: significant impact on budget (in Cape Town for Phase 1a: nearly R500m lost to VAT)

2. Additional PTIS funding allocated not adequate to complete Phase 1a, especially if VAT payable.

3. Start operation of Phase 1a starter service as soon as possible after World Cup to ensure early utilisation of infrastructure investment.

4. Investigating creative ways to minimise and deal with expected operating deficit in Phase 1a.

Cape Town Integrated Rapid TransitChallenges

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A contracted public transport system incorporating both buses and taxis, with common ticketing

All current taxi & bus operations to be a single network– focus on Transformation of taxi industry first, full integration after 3

– 5 years Network to comprise 5 contract packages Due to current taxi negotiations, network will not be ready by

2010 – instead aiming for a pilot 25 bus event service for World Cup Forming 5 co-ops to run interim years with Recap taxis Need to fast-track new Business Plan that costs approach

suggested by local taxi industry Require DoT & Treasury approval for costing of new approach & subsequent prioritisation of 2010/11&12/13 PTIS

Nelson Mandela BayStatus – Partial BRT but aiming to contract a full city-wide network by

depending on taxi operator negotiations

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1. Require clarity on Govt Guarantee no loss of profits – demanding R8000 per month per vehicle.

2. Require guidelines as to how to include operators into “Value Chain” ito current procurement legislation.

3. Proposing an interim 2-5 year contract for transformation of taxi industry before entering full 12 year negotiated contract.

4. Need to fast-track DOT support for the dedicated project team

Nelson Mandela Bay Challenges

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TshwaneStatus – Implementation of Line 1 of Phase 1 – designs are being finalised, discussions with PT industry progressing

Line 1: Mabopane Station to the CBD – 37 km of lanes and 17 stations prioritised for Phase 1 implementation

Station designs: station concepts launched – designs are proceeding

Infrastructure design – professional team appointed – designs are being fast tracked

Discussions with DoT on full network design to take place Financial Plan and Model development in an advanced

stage – first output by mid March 2010 Integrated Marketing and Communication Strategy

developed

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Liaison with Public Transport Industry: Meetings held with Taxi Councils, Bus Operators and

Commuters BRT Stakeholder Summit being planned for March/April

2010 – will set platform for further engagement and negotiations with affected operators

Tshwane BRT Team being further developed as part of re-alignment of departments – new Transport and Roads Department being established

Institutional Model – options are pursued as part of Business and Financial Plan – Section 78 in terms of MSA to be followed

Tshwane BRT

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Intelligent Transport Systems (ITS) Roadmap completed – ITS tenders being developed

Vehicle specification being developed – funding of vehicles to be finalised after finalisation of Financial Plan

Tshwane BRT

Construct BRT lanes along some 6- 11 kms of road of line 1

Construct BRT stations at Mabopane station and on DF Malan Drive near its intersection with Boom Street

Provision of an event specific service and part of the overall 2010 FIFA© World Cup Transport Plan

Utilising completed elements of the BRT network

Tshwane BRT and WC2010

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Progress in other 8 IRPTN cities is still at early planning level

Buffalo City - has completed Draft Operational Plan Polokwane & Rustenburg – Operational Plans in progress Mbombela – IPTN Operational Plan complete – Business

Plan in preparation. Need dedicated team and project leader! Ekurhuleni & Ethekwini – Operational Plans in tender

procurement process Mangaung & Msunduzi – have Operational Plan tenders in

preparation but need intervention to motivate city officials to move faster and take on the responsibility

Operational network planning will commence in 2010/11 in the Rural districts

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National Joint Working Group….1

NJWG’s role is to advise the Minister and Minmec and to propose National frameworks and guidelines.

NJWG BRT sub committee’s terms of reference is to develop a National Framework for BRT implementation that will apply to current and future projects.

NJWG does not replace the need for local level business negotiations between cities and affected operators

It was agreed that NJWG would prioritise BRT and report back to Minister within 3 months of initiation

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National Joint Working Group….2

Need to drive and focus NJWG taxi process to finally set up a mechanism of local/regional, provincial and national co-operatives or companies as legal entities which can: Restructure local taxi operations along more profitable

lines Participate in Government public transport contracting

opportunities (for both city IRPTNs but also in future rural periodic public transport service contracts etc)

Participate in supporting value chain opportunities and Any other ventures that are deemed appropriate

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IPTN/BRT linkages to NLTA & National Public Transport Regulator

The provisions of the NLTA - which is an instrument of the PTS ensure that the necessary “integration” takes place through: the statutory Intermodal Planning Committees (IPCs) that are to

be established in respect of the preparation of the public transport component of the Integrated Transport Plans (ITPs) and complementary Operational Plans

cities taking the responsibility for integrating all public transport in their areas under a single locus of accountability which will hold planning, funding and regulatory powers/ functions

The Department will urgently drive the assignment of the regulatory function to local level where capacity exists. A viability exercise in assigning the function will be undertaken. Issues around capacity shortages at local level will be looked into

Need to ensure the implementation of the National Transport Regulator to enhance the delivery of public transport services

2.1 Implementation challenges

• All the foregoing problems can be addressed through system adjustments

• Monitoring is essential to identify problems and ensure timely remedies

2.2 The way forward

• Cities must share experience & benefit from each others successes & mistakes

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2. WAY FORWARD

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1. Insufficient ongoing funding a major concern. BRTs are mass transit network projects needing sustained funding for 10-20 years.

2. Delays incurred as a result of the initially slow national engagement and negotiations with the taxi industry.

3. A need exists to fast-track engagement with SABOA and its members

4. Environmental & heritage impacts and protests from car-using residents must be managed resolutely.

5. Cities need to set up dedicated project teams as a condition for further funding.

6. Cities & PRASA need to integrate planning of IRPTNs/BRTs and Priority Rail Corridors much better.

7. Cities need to insist on viable network designs that maximise coverage & speed - not designs that least impact car users!

2.1 Implementation challenges

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1. DoT, National Treasury and DTI, Provinces and cities have established an Inter Departmental Forum under the leadership of Deputy Minister to discuss, coordinate and agree on way forward concerning current issues and challenges related to Integrated Public Transport and BRT implementation: PTIS Funding –covering transitional costs Compensation model for taxi and bus industry Bus and Rail Procurement - explore local funding (IDC,PIC and

DBSA) and local manufacturing and assembly of buses in support of the Industrial Policy Action Plan

Assigning planning, funding and regulatory powers and functions to municipalities where capacity exists

Alignment with Bus subsidies and Taxi Recap programmes Etc

2. DoT will embark on Roadshows with Deputy Minister to all cities - engaging also cities that are lagging behind

2.2 Way Forward

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3. Focus of PTIS Grant is on funding IRPTN implementation.4. Work continues to align PTO Grant with IRPTN rollout. 5. PTOG funds from subsidised services “replaced” by

IRPTN, can be used for IRPTN development.6. Cities & PRASA must develop an integrated operational

plan for presentation to MINMEC in June 20107. Mass communication required to inform stakeholders about

transformation of Public Transport8. Enforcement to protect new infrastructure & stations is

essential9. DoT to tackle under-capacity of provinces & municipalities

(secondments, training, project-based mentoring led by international and local experts)

2.2 Way Forward

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Thank YouThank You

DankieDankie

EnkosiEnkosi

Overview of BRT starter serviceCurrent Starter Service Trunk route (T1) service from Thokoza Park to Ellis Park only Smaller CBD circle routes C3 & C4 withdrawn Nov 09 due to

poor patronage 25.5 Kilometre journey, 23 Stations on round trip From 11 800 passengers per day to 17 000 28 Articulated and 6 Complementary buses in use 203 Trips per day Services from 04:50 to 21:00 weekdays Clidet Special Purpose Vehicle doing services with 75

retrained ex taxi drivers Operational budget of R103 million for 09/10 financial year Biggest challenge is keeping to timetable with road works

and congestion

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The complete phase 1A will be rolled out between 1 March and 3 May

1 March 2010 - A new complementary service running directly from Dobsonville to the Johanneburg CBD and Ellis Park Station and feeder services are planned to be implemented: Dobsonville to Ellis Park Complementary service (21 buses) Naledi to Thokoza Park Station (3 buses) Jabavu to Lake View Station (4 buses) Mofolo to Boomtown Station (2 buses) Services introduced on 1 March 2010 will operate the same first and

last bus times as the current starter service

Roll out of full Rea Vaya Phase 1A from 1st of March 2010...1

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3 May 2010 - The final services scheduled for introduction will include an additional complementary service directly from Dobsonville to Maponya Mall and feeder services

A CBD distribution service will be reintroduced to link the trunk services with Braamfontein, Wits University and Hillbrow.

All service times will be extended: The last buses will depart at 22:40 Sunday services will also be introduced on all routes The feeder and complementary buses will stop at over

170 bus stops along the routes


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Drivers are already being trained Bus stops are being erected More staff will be employed Full Phase 1a service will include:

real-time tracking of bus movements and communication between driver and Control Room

next station announcements on bus, announcements to passengers on bus, both verbally and through the use of variable message signs

Additional Depos are being constructed


Progress on negotiations• Significant capacity building and information sharing including

reports from Clidet CEO• 95% agreement on the Bus Operating Contract• Signed agreement in November on compensation for 167 vehicles

that had been affected by starter service• Signed a “Framework Participation Agreement” in January which:

– Defines beneficiaries– Determines process to arrive at agreed list of beneficiaries – Increases number of beneficiaries from 575 to 585– Agrees that vehicles to be handed over to the City for scrapping

or resale after stringent verification process• Both parties have determined their initial proposed ‘fee per km’

Fee per km• City proposed fee per km which is based on international best

practice financial model, experience to date on starter service and reasonable profit is R20.97 and R24.62 per km for 13 and 18 m buses

• To provide this fee per km, tariffs will need to be adjusted by 18% and then will increase in terms of an agreed escalation formula.

• Taxi industry’s proposed fee per km is R14 higher than ours (R36.35 and R38.85 for two different size buses

• Negotiations at the moment are trying to narrow difference – Key variance is in profit margin (ours is 15%) – based on a

‘restraint of trade’ payment to shareholders because they re taking their taxis off the road

– Also have input costs which are higher than ours including a management fee per bus of R3000.

• Bus Operating Contract requires that COJ is satisfied that the new Company can manage satisfactorily

Issues in respect of the fee per km

• Rea Vaya has proposed to the City a budget for 09/10 based on our proposed fee per km and tariff adjustment

• If we have to settle on greater than this, funds must come from:– Tariff increase (in an election year?)– City (with significant budget constraints: 2010 and election year)– ? Operational subsidy or capital grant from national government

• Estimated amounts required are:– If agree to TI proposal of R9 000 ‘restraint of trade monthly

payment’ and there ‘mark up’ of 20%, we will require R120 million per annum

– If agree to settle with TI at mid point between our and their current offers: shortfall is R50 million per annum.

• Another option is to replace ‘restraint of trade amount’ with one off compensation so as not to inflate the fee per km.

Compensation for loss of income• Short term compensation for loss of income due to the operations of

Rea Vaya– We have already paid R3 167 000 for loss of income to operators

of 167 vehicles for an assumed period of time from November to end Jan/February

– Already indications that more money is going to be asked for and difficult to refuse if BOC is not up by 1 March 2010

– Since there needs to be a phase out of taxis and phase in of buses, it is likely that a further call for compensation for loss of income will be made

– This is not yet costed• We have not been asked for ‘compensation to exit the industry’ but

‘restraint of trade’ could be seen as an ‘equivalent demand’

Transitional and transformation costs

• About 50% of our operational budget for 09/10 could be regarded as transitional and transformational costs including:– Taxi industry capacitation and negotiation support– Independent facilitators– Security costs– Additional communication costs

• We have agreed to pay for training but industry also want us to remunerate their drivers while under training

• We have found budget from ‘converting PTIS CAPEX to OPEX’ in 09/10 financial year and have asked City for total Opex R213 million budget for 10/11 but are not certain of getting it

Bus procurement

Background• After extensive discussions and an international road show, City

decided:– Approach BNDES ECA to funds buses– Contracted HSBC as fund arrangers and advisors

• Reasons for going for international loan funding included:– Explore and pilot alternative and competitive sources of funding– Possible legislative obstacles to vehicle financing for such a long

period– HSBC and BNDES familiar with BRT systems– Offered very good interest rates (4 - 6%)

Bus procurement process• City procured buses on behalf of still to be formed BOC on

understanding that BOC once established would take over bus company and loan financing

• This has not happened to date. Consequences are as follows:– Contingent liability/possible liability for the City of about R420

million – City has had to arrange guarantees at significant costs

(approaching R5 million)• At the moment HSBC issued guarantee until end 26 February 2010.

Are holding R88 million of City cash as collateral.• COJ and HSBC planned that funds for bus procurement and working

capital for new Bus Company would come from:– BNDES: 100% of bus purchase price and 85% of ECA financing

costs– Local funding from DBSA, PIC, IDC: $18 million – Equity from taxi beneficiaries (small amount: 575 x R54 000 =

R31 million – currently under negotiations)

Where we are to date• Colleagues are in Brazil finalising BNDES loan • BNDES loan will need to be repaid in dollars

– New BOC and ultimately City will be exposed to significant FOREX and interest rate fluctuation risk

– Requires hedging strategy which also requires extra funds and ‘extra’ guarantees from the City

• City approached NT re managing these risks and we are now working with them and talking to them about:– Possible local funding (DBSA and others) for entire deal– Desirability of buses being owned by City vs BOC– Next phase would need to draw on lessons of this phase.

Conclusion and issues• Funding issues arising from the taxi industry negotiations include:

– Operational subsidy for fee per km – Transitional and transformation costs– Funding compensation for loss of income

• Funding issues arising from the bus procurement process include:– Local vs. foreign funding– How to deal with foreign exchange and interest rate risks with off

shore funding

Nelson Mandela Bay - Model• The operations themselves will be under the command and control of the

professional managers of the cooperatives. • Services will be scheduled, operated almost entirely with recap-compliant

vehicles, which will be subject to a strict maintenance programme. • Drivers will be trained, employed in terms of the Taxi Industry Sectoral

Determination of the Department of Labour, and subject to disciplinary control and sanctions similar to those of the big bus companies.

The transformation process• The Forum, representing the taxi industry in the area has

proposed the following transformation process for the taxi industry:

• Phase 1: Preparation and start-up (Year 1)• This Phase will include obtaining stakeholder buy-in, planning and

registration of the requisite co-operatives. This process has in fact already commenced.

Phase 2: Co-operative management (Year 2)• During this Phase each co-operatives will become responsible for

providing the public transport service required from it in terms of the contract to be concluded with the NMBM. Ownership of the vehicles will however remain with the existing owners. The taxi industry’s rationale for this is that it provides/allows for individual operators to withdraw from the system should the need arise (i.e. if their involvement in the new system results in a loss of profits).

• It is envisaged that the co-operatives will formally employ the requisite staff and procure the necessary systems necessary to provide the contracted service.

• The taxi industry’s view is that during this Phase, the members of the co-operatives will begin to receive payments from Government (‘profit guarantee’) in keeping with the guarantee of no loss of legitimate profits. The interpretation of this guarantee and accordingly its application is however still subject to debate (please refer to Section 12 below).

• In accordance with the envisaged ‘gross’ contract to be concluded with the NMBM, the co-operatives will be remunerated on a per kilometre, rather than a per passenger basis.

Nelson Mandela Bay - ModelNelson Mandela Bay - Model

Phase 3: Co-operative ownership (Year 2)• The taxi industry proposes that during this Phase, the co-

operatives will become the owners of the fleet necessary to provide the contracted service. The co-operatives will either procure new vehicles or purchase vehicles from its members.

• The taxi industry’s view is that the co-operatives will purchase the required vehicles from its members, however this raises potential financial implications, as well as issue as to vehicle age and fleet composition (see Section 8 below for a discussion of the high-level costing).

• Phase 4: End-state• During this Phase the Forum proposes that the co-operatives will

consider the formation of a fully integrated IPTS.

Nelson Mandela Bay - ModelNelson Mandela Bay - Model

IRT Phase 1a : Taxi & Bus Industry Transition Progress

Industry Transition Model1. Determine IRT Corridor & routes

2. Identify directly & indirectly affected existing bus and taxi operators

3. Determine share of existing market

4. Determine value of existing taxi business

5. Calculate compensation

6. Offer shares in new Bus Operator Co or allow to exit

If one was to develop an agenda around compensation, the outline might look something like this:

Objectives Standardise compensation calculations for all cities (important

since there will be a sense of unfairness if one city is more generous than another) Develop effective mechanisms for communicating the Compensation processes to operatorsIdentify the appropriate funding mechanism to pay for compensation.Current status of each City’s compensation issuesOptions for calculating compensationCommunicating the compensation processFunding compensation

Compesation Model

IRT PHASE 1A : TAXI & BUSINDUSTRY TRANSITION PROGRESS

Phase 1a Corridor Vehicle Operator Contracts

2Contracts

2Companies

NORTHERNWest Coast

SOUTHERNInner City

AFFECTED OPERATORS


DIRECTLYAFFECTED

INDIRECTLYAFFECTED

NOTAFFECTED

Peninsula T.A Central Unity T.A Blaauwberg T.A United T.A Maitland T.A Devils Peak Vredehoek T.A Ysterplaat T.A Du Noon T.A

Partially Affected Motherbodies

(Cata, Codeta, NTA)

ALL OTHER

PHASE 1A BROADER INDUSTRY

Western Cape Provincial Taxi Council

INITIALLY LARGELY REPRESENTED BY

Parallel process with affected bus operators : GABS + SIBANYE

LATER ALSO REPRESENTED BY

Western Cape NTA

MAIN OBJECTIVE


8TAXI

ASSOCIATIONSApprox 700 taxis

+2BUS

COMPANIESApprox 200 buses

TRANSFORM

2IRT VEHICLE OPERATOR COMPANIES

Approx 270 buses

BR

OA

DER

IND

US

TR

Y

CHALLENGE


TRANSFORM

Existing (taxi) operators should not be worse off (bus?)

No significant loss of legitimate jobs

TRANSITION PROCESS

PTA CUTA DPVTA BATA UTA MATA YTA DTA GABS SIBANYE

MEETINGS / DISCUSSIONS / VISITS

MEETINGS / DISCUSSIONS

VEHICLE OPERATOR PROSPECTUS

BRT SYSTEMS

IRT PROPOSALS (Phase 1a)

COMPANY

CONTRACT 1

CONTRACTAGREEMENT

SIGNING OFCONTRACT

SIGNING OFCONTRACT

CONTRACTAGREEMENT

CONTRACT 2

COMPANY

A BNEGOTIATIONSkm tariffContract document

CONSU

LTATIO

NNEG

OTIATIO

NS

COMPA

NY FO

RMAT

ION





BRT SYSTEMS


COMPANY

CONTRACT 1

CONTRACTAGREEMENT

SIGNING OFCONTRACT

SIGNING OFCONTRACT

CONTRACTAGREEMENT

CONTRACT 2

COMPANY


CONSU

LTATIO

NNEG

OTIATIO

NS

COMPA

NY FO

RMAT

ION





BRT SYSTEMS


COMPANY

CONTRACT 1

CONTRACTAGREEMENT

SIGNING OFCONTRACT

SIGNING OFCONTRACT

CONTRACTAGREEMENT

CONTRACT 2

COMPANY


CONSU

LTATIO

NNEG

OTIATIO

NS

COMPA

NY FO

RMAT

ION





BRT SYSTEMS


COMPANY

CONTRACT 1

CONTRACTAGREEMENT

SIGNING OFCONTRACT

SIGNING OFCONTRACT

CONTRACTAGREEMENT

CONTRACT 2

COMPANY


CONSU

LTATIO

NNEG

OTIATIO

NS

COMPA

NY FO

RMAT

ION

NEGOTIATIONSkm tariffContract document

CONSU

LTATIO

NNEG

OTIATIO

NS

COMPA

NY FO

RMAT

ION

CONSU

LTATIO

NNEG

OTIATIO

NS

COMPA

NY FO

RMAT

ION

CONSU

LTATIO

NNEG

OTIATIO

NS

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TRANSITION PROCESS


CONTRACT 1INNER CITY

• Inner City Distribution Service• Airport-City Trunk Service• Portion of Phase 1a Trunk Service

CONTRACT 2BLAAUWBERG

TRANSITION PROCESS





• Feeder services from Salt River to Atlantis

• Portion of Phase 1a Trunk Service

TRANSITION PROCESS


COMPANY A• PTA (Peninsula T A)• CUTA (Central Unity T A)• DPVTA (Devils Peak Vredehoek)• GABS (Golden Arrow Bus Co)






TRANSITION PROCESS



COMPANY B• BTA (Blaauwberg T A)• UTA (United T A)• MATA (Maitland T A)• YTA (Ysterplaat T A)• DTA (Du Noon T A)• SIBANYE (Bus Company)






FACILITATORS


COMPANY A COMPANY B

Sedick Crombie Nico McLachlan

PARTICIPATION



COMPANY B• BTA (Blaauwberg T A)• UTA (United T A)• MATA (Maitland T A)• YTA (Ysterplaat T A)• DTA (Du Noon T A)• SIBANYE (Bus Company)

Sedick Crombie Nico McLachlan

TRANSITION PROCESS

Phase 1a Challenge

• Profit in new IRT system < current system

• Either : (a) Add operating subsidy (b) Reduce number of shareholders

by offering exit / lump sum packages

• Option (b) preferred

• Preparing detailed motivation

• Proposed Compensation Model


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IRPTN/BRT linkages to Bus Subsidy Reform

Public Transport Operations Grant under the Division of Revenue Act requires full integration of subsidised service designs with IPTNs.

Given that cities are responsible for IRPTNs – maximal integration is required between the Phase 1 BRTs and redesigned subsidised contracts.

Therefore, cities with IRPTNs/BRTs must agree to the subsidised service designs and management of services within the municipal area.

Where Phase 1 BRTs replace existing subsidised services – if required - the relevant funding attributed to the service being replaced should go into the BRT system in order to cover set up costs relating to regulation, security, marketing, guaranteed returns for incumbents etc.

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IRPTN/BRT linkages to Taxi Recapitalisation

Those operators affected by a BRT/IRPTN and who have a vehicle that is eligible for scrapping – should be prioritised in terms of taxi recapitalisation.

Cities will then negotiate with local affected operators who qualify for the scrapping subsidy with regard to investing all or some of it as equity in a BRT operating company.

Those operators who have already recapitalised and are affected by BRTs/IRPTNs need to negotiate with cities as to facilitating the sale of their vehicles - if they are not required in the new system.

The DoT should be mandated to urgently develop a scheme for qualifying already recapitalised vehicles that are affected by BRTs and IRPTNs in which these could possibly qualify for a scrapping subsidy – if they are resold to an unaffected taxi operator as part of the normal scrapping process.

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IRPTN/BRT linkages to Priority Rail Corridors

There needs to be a greater sharing of operational plan information between PRASA and cities with a view to developing integrated BRT and Rail trunk services of a similar standard – with both served by an integrated, formal, high quality feeder service.

Priority Rail Corridors should have a similar operating standard as BRT in terms of schedules, frequencies, marketing, journey times per distance, security, customer service and information, station experience, special needs access, etc.

Standardising the quality of both Rail Priority Corridors and BRT networks is the first step to full integration in the medium term.

The 3 cities planning full BRTs and PRASA need to be given 6 months to come back to Minmec with integrated and detailed operational plans for standardising quality and for developing common feeder services that includes at least one Rail Priority corridor, one BRT trunk corridor and a common feeder service to both in each of the 3 cities.

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IRPTN/BRT linkages to PTIS Grant

It is therefore vital that IRPTNs/BRTs received sustained funding over at least 5 to 10 years in order to cover transitional costs, to maximise network coverage and to generate additional income from new users, advertising, new levies on car use etc.

Sustained funding from the PTIS and PTO Grants in the Division of Revenue Act should be linked to a set of stringent criteria such as: High quality network operational plan that is approved by City Government Dedicated project team with an innovative focus on reprioritising existing

road and parking space Sufficient network coverage and passenger revenue to at least cover all

direct operating costs. Indirect public investment costs like security, guaranteed returns to

incumbents, regulatory costs, etc. being the preferred areas for budgetary support.

Medium term plans to raise system income through car and parking levies, advertising and sponsorship, raising ridership levels etc.

The national guarantee of “no loss of legitimate business” by affected operators and workers who shift to BRT places an additional burden on costs.

1 portfolio committee on transport tuesday 09 march 2010 briefing on bus rapid transit system (brt)...

Documents

rea vaya vehicles

system identity slide

progress update slide

affected operators

city of johannesburg

minibus taxi industry

way forward slide

transition phase