[sustran] [sustran] more on Skytrain

Eric Bruun ericbruun at earthlink.net
Fri May 30 01:38:53 JST 2003


Karl

Thanks for the update about the finances of SkyTrain.

I think that there are two issues here which should be separated.

One issue is the modal choice.I don't know Bangkok, but I imagine there
would have to be massive dislocation to build something like TransMillennio
if the right-of-way is not already available. It requires four lanes plus
stations in the middle and long overpasses to access stations. While I
support as many TransMillenio systems as can possibly be built, they can not
be built everywhere. When rail systems are built, they will be there a long
time, so from a sustainable development standpoint even the high capital
cost might be justified.

The second issue is the fare level. I think it is obscene for a city as
congested and polluted as Bangkok to have a rapid transit line cross it
which uses only a fraction of its capacity. Surely the demand is out there,
since most other large, congested cities have overloaded rapid transit
systems. If I understand it correctly the fares were set too high for the
majority of residents to afford. It seems you have to be rich enough to own
a car to be able to afford SkyTrain. I think the whole privately financed
idea was just right-wing ideology coming from the World Bank. If the rich
countries don't expect fares to recover capital investment where the
residents have a much higher ability to pay, why should this work in lower
income countries?

Eric Bruun



----- Original Message -----
From: "Karl Fjellstrom" <karl at dnet.net.id>
To: <sustran-discuss at jca.ax.apc.org>
Sent: Thursday, May 29, 2003 12:28 AM
Subject: [sustran] Re: Skytrain


> Eric,
>
> Thanks for your v interesting info on the US metro lines and I'm happy
> to provide a few more details on Bangkok. I'd welcome any corrections or
> additional info.
>
> The city & national government together have spent around US$145 million
> per km on a 20km, 19-station "Blue Line" subway which will open in
> Bangkok in April 2004. It will intersect with the 23km Skytrain network
> at 3 places but will not be fare integrated. The Blue Line is one of the
> ways the government is supporting the Skytrain, as clearly it will
> significantly enlarge the Skytrain's catchment. Even the Skytrain, which
> goes through prime areas of Bangkok, has difficulty getting ridership to
> cover operating costs and it's still operating at around 40% of the
> projected ridership for 1999. So it's difficult to see how the Blue
> Line, which has a much less juicy catchment, will cover costs. The
> government btw has paid the $2.7 billion infrastructure price tag for
> the Blue Line. The concessionaire is expected to pay for the system
> operation & rolling stock.
>
> [To put it in perspective, TransMilenio BRT in Bogota cost the govt
> around $5 mill per km (with no operational subsidy) and carries nearly
> double (currently at 770,000 passengers per day and rising) the number
> of passengers per day that the Skytrain and Blue Line together will
> carry in 2004. TransMilenio is the same length as the two Bangkok rail
> systems combined.]
>
> Another, more direct way the government is supporting the Skytrain is by
> paying for infrastructure extensions to the Skytrain network; 2km to
> open next year and a further 17.2km approved. The program of rail metro
> expansion in Bangkok has received a big boost in May 2003 with a new
> Master Plan calling for a 100km network by 2010. Other options such as
> Bus Rapid Transit were not seriously considered.
>
> The original owner of the Skytrain,  Tanayong, is otherwise occupied (in
> Bankruptcy Court proceedings), and meanwhile one of the Skytrain
> operating company's major objectives appears to be to try to get the
> government to pay for more infrastructure extensions to its network. One
> way this is done is by exaggerating the benefits of the Skytrain. I'm
> sure there are others ...
>
> Regards, Karl
>
>
>
> -----Original Message-----
> From: owner-sustran-discuss at jca.ax.apc.org
> [mailto:owner-sustran-discuss at jca.ax.apc.org] On Behalf Of Eric Bruun
> Sent: Tuesday, 27 May 2003 12:25 AM
> To: sustran-discuss at jca.ax.apc.org
> Cc: del Mistro
> Subject: [sustran] Re: Skytrain
>
>
>
> Karl
>
> 1) Actually, many of us are vitally interested in how the finances of
> the SkyTrain are doing. It is an extremely important issue, since
> privately financed proposals are being presented around the world. I too
> would appreciate some information.
>
> 2) You are right about the lack of transparency in decision making in
> the US (and Canada). There are some decisions begin made which are
> clearly to the benefit of special interests and disregard more urgent
> investments with better return-on-investment to the public at large. For
> example, the Blue Line extention of the Washington, DC Metro cost $400
> Million for only a couple of miles and seems to be largely for the
> benefit of the professional sports stadium owners. Meanwhile, a short
> light-rail line for the same cost would close the U of the Red Line and
> address far more significant needs. Same in Pittsburgh. There is a $300
> Million tunnel under a river which goes to the pro sports stadiums and
> then stops. If one is going to spend the money on a tunnel, then the
> incremental benefit to cost ratio is very high to extend it further into
> other communities.
>
> Eric Bruun
> ----- Original Message -----
> From: "Craig Townsend" <townsend at central.murdoch.edu.au>
> To: <sustran-discuss at jca.ax.apc.org>
> Sent: Monday, May 26, 2003 3:56 AM
> Subject: [sustran] Re: FW: Land Value Taxation Event 23/04/03
>
>
> > Karl,
> >
> > I haven't kept up with the recent details concerning the extensions to
>
> > the
> BTS
> > and other issues regarding government support to Bangkok's rail
> > systems
> under
> > construction. From your comments, it sounds like the Government of
> Thailand is
> > now providing financial support to the BTSC: an operating subsidy or
> > help
> with
> > debt servicing?. Could you or anyone else provide me with some details
> (e.g.
> > cost, financing, government agencies involved)? It would probably be
> > best
> if
> > you reply to me personally (townsend at central.murdoch.edu.au), rather
> > than through Sustran, and would be much appreciated. Thanks.
> >
> > Craig
> >
> > Quoting Karl Fjellstrom <karl at dnet.net.id>:
> >
> > > Thanks for the updates & interesting information on the US.
> > >
> > > The 'lack of transparency' I was referring to is about mass transit
> > > options. Transparency may be much greater in the US but even there,
> > > when policy-makers (or was it a referendum) approve spending $180
> > > million per km on a metro rail system in Washington, are they really
>
> > > exploring all available options in a transparent manner?
> > >
> > > Lack of transparency often means a lack of information about how
> > > public money is being used. A good example is the comment below that
>
> > > 'government institutions are not really involved' in the Bangkok
> > > Skytrain. If only ... In fact, the government is paying for the
> > > infrastructure for Skytrain extensions; 2km to open next year and a
> > > further 17.2km approved. It's probably only through the ongoing
> > > intimate involvement of the government that the system is still
> > > operating, as it has never covered its operating expenses plus
> > > interest costs.
> > >
> > > Even if there were perfect transparency, however, it's true that the
>
> > > interests of powerful landowners - as described below - would
> > > probably keep something like value capture off the political agenda
> > > anyway, at least in Bangkok.
> > >
> > > Regards, Karl Fjellstrom
> > >
> > >
> > >
> > >
> > >
> > > -----Original Message-----
> > > From: owner-sustran-discuss at jca.ax.apc.org
> > > [mailto:owner-sustran-discuss at jca.ax.apc.org] On Behalf Of Craig
> > > Townsend
> > > Sent: Sunday, 25 May 2003 4:23 AM
> > > To: sustran-discuss at jca.ax.apc.org
> > > Subject: [sustran] Re: FW: Land Value Taxation Event 23/04/03
> > >
> > >
> > > Eric makes good points about the US. Similarly, in Canadian cities
> > > the level of transparency surrounding mass public transport projects
>
> > > (usually
> > > rail) is
> > > very high. Costs of public transport projects and operations are the
>
> > > subject of a high level of public scrutiny and debate. There is a
> > > big debate going on
> > > now in Vancouver about a proposed rail line, and due to extensive
> news
> > > coverage anyone who reads the newspaper has a good understanding of
> the
> > > costs
> > > involved and the various debates surrounding the project: e.g. see
> > > today's
> > > Vancouver Sun newspaper http://www.canada.com/vancouver/story.asp?
> > > id=30BD1DF4-E7CC-42BD-AA5C-D3D310ACF9E0). The level of transparency
> > > surrounding road projects is typically much lower.
> > >
> > > One point that I would like to make about value capture is that it
> > > is worth clarifying who is capturing value. A form of indirect value
>
> > > capture by government (and hence in theory all sectors of society)
> > > from transport infrastructure improvements does occur in Australia
> > > because the improvements
> > > raise the market value of adjacent lands. Those increases are
> reflected
> > > in the
> > > level of property assessment and will result in more tax revenue to
> the
> > > government. The situation is different in Bangkok where there are
> only
> > > small
> > > administrative charges on land owners, but no taxation based on
> assessed
> > >
> > > market value. The Bangkok Transit System is a privately owned and
> > > operated rail rapid transit system. The owners of the system make
> > > deals with other
> > > corporations, businesspeople, and landowners to mutually increase
> their
> > > revenue, but government institutions are not really involved.
> > >
> > > Craig Townsend
> > >
> > > Quoting Eric Bruun <ericbruun at earthlink.net>:
> > >
> > > >
> > > > I want to point out that in some places, public transport agencies
>
> > > > are specfically not allowed to use land value capture. It would
> > > > take changes in laws first.
> > > >
> > > > Secondly, the lack of transparency about costs for public
> > > > transport projects is certainly not true in the US. The Federal
> > > > government requires all kinds of documentation about local/state
> > > > contributions and about future operating cost supports for public
> > > > transport projects
> > >
> > > > before it contributes. This is then used by the highway lobby to
> > > > point
> > >
> > > > out how expensive public transport is. But the truth is that there
>
> > > > is no matching requirement for highway projects, especially not
> > > > about the
> > >
> > > > operating and maintenance costs. This is good for the highway
> > > > lobby, because much of the operating support comes from property
> > > > taxes and general taxation, not from user taxes.
> > > >
> > > > Eric Bruun
> > > >
> > > > ----- Original Message -----
> > > > From: "Karl Fjellstrom" <karl at dnet.net.id>
> > > > To: <sustran-discuss at jca.ax.apc.org>
> > > > Sent: Friday, May 23, 2003 5:05 AM
> > > > Subject: [sustran] Re: FW: Land Value Taxation Event 23/04/03
> > > >
> > > >
> > > > > Dear Paul & Craig, sorry for the delayed response.
> > > > >
> > > > > Bogota implemented a value capture scheme along the TransMilenio
> > > > > (www.transmilenio.gov.co) lines which was apparently (according
> > > > > to the Mayor of the time) successful in recouping some of the
> > > > > windfall gains which accrued to land ownwers along the
> > > > > TransMilenio route. This value capture is an important part of
> > > > > the funding arrangement for the ongoing expansion of the system.
> > > > >
> > > > > The COO of Bangkok's Skytrain system in March gave a
> > > > > presentation to the Thai-German Chamber of Commerce where he
> > > > > outlined major increases in property values in proximity to the
> > > > > Skytrain stations; especially for commercial premises like
> > > > > shopping malls. Responding to a question, he said however that
> > > > > there was no plan for any kind of tax/charge to capture the
> > > > > windfall gains to the owners of these premises, but that they to
>
> > > > > some extent capture these gains by imposing charges for the
> > > > > commercial premises to establish walkway connections to the
> > > > > Skytrain stations.
> > > > >
> > > > > Similarly in Brisbane, when it is proposed to the transit
> > > > > officials express strong interest in some form of value capture
> > > > > to fund system
> > >
> > > > > expansion, though nothing like that has been implemented there.
> > > > > What's the catch? Here's my conspiracy theory: there is often an
>
> > > > > incredible dearth of transparency and open debate surrounding
> > > > > all issues of mass transit system cost, especially when it comes
>
> > > > > to rail
> > >
> > > > > metros. It's only when there is no financial black hole to hide,
>
> > > > > such as in Bogota's bus rapid transit system, that you might see
>
> > > > > these options openly canvassed. (Political commitment helps too,
>
> > > > > of
> > > > > course...)
> > > > >
> > > > > Regards
> > > > > Karl Fjellstrom
> > >
> > >
> > >
> >
> >
>
>



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