In his second term as Governor of the State of São Paulo, Geraldo Alckmin from the Brazilian Social Democratic Party (PSDB) has ruled out the possibility of repeating the model for one of the main projects which has been a trademark of his previous administration, which is the model of Public-Private Partnerships (PPP) as used in Line 4 of the São Paulo Subway System. The Government is preparing four new PPPs for public transport (two for Subway lines and two for train lines), but in these new projects the private partner will take on the responsibility of execution of the whole package, which includes the work itself, while the State will provide a larger counterprovision to be paid throughout the concession. In the model of Line 4, the State has constructed the line and the winning consortium will be responsible for the operation thereof.
The assessment made by the Secretary for Metropolitan Transport, Jurandir Fernandes, who was director of this department at the time when the PPP contract for Line 4 was signed, is that it was difficult to integrate the work conducted by the Government and by private enterprise in the operation of the line. According to Mr Fernandes, this is one of the reasons why the delivery of the stations is running behind schedule. The initial forecast was the year of 2006. I am sure that the next PPPs will be quicker. We are paying the price for lack of experience, says Mr Fernandes.
On Line 4, the consortium is responsible for the purchase of the trains and also for the implementation of the communication system, while the State will be responsible for the construction of the tunnels, signalling, the electrical part, the stations and also the marshalling yards. For this, four separate suppliers are involved. Rotem, from South Korea, and Siemens from Germany are responsible for producing the trains. The Korean consortium, Trends Poscon, is responsible for the automatic doors on the platforms, and the French company Alstom is in charge of operations.
All these companies need to talk among themselves, and we cannot control the fact that all follow the same model. The best available course of action is making the package. We will be establishing a PPP for a whole line of the Subway, says Mr Fernandes. The ViaQuatro Consortium, the concessionaire for Line 4 (the Yellow Line) was approached, but had not yet answered when this edition was closed.
The Secretary has announced four PPPs for the Subway and also for the São Paulo Commuter Train Company (Companhia Paulista de Trens Metropolitanos – CPTM). One of these is the train to Guarulhos, which is the Jade Line (Line 13) between Brás Station and the future Zezinho Magalhães Station, which should be constructed independently of the Airport Express, this being filed while awaiting a decision about the bullet train service between Rio de Janeiro and São Paulo.
The other projects are Line 6 of the São Paulo Subway (between São Joaquim and Freguesia do Ó), the extension of Line 9 (Osasco – Grajaú) to Varginha, and the project for the White Line (Line 15) between Vila Prudente and Tiquatira Avenue (Penha).
However, São Paulo has a track record of PPPs that never got off the ground. In 2007, at the start of the administration of José Serra (PSDB), no less than six PPPs were announced, of which two were in the rail transport segment: the Airport and Bandeirantes Express. The others were those of digital identification, the export corridor, and the Fundação Factory for Popular Medications in Américo Brasiliense, and prisons. The two signed by the Government were those for Line 4 of the Subway and the Water Treatment Station at Taiaçupeba.
The Sabesp Water Treatment Station is already in operation, while Line 4 has been facing a saga ever since 2004, when it started being built. Completion was initially scheduled for 2006, but the PPP was signed only in December of that year, hence the inauguration was put back to 2008. However, in 2007 there was a serious accident at Pinheiros Station, when seven people lost their lives, and the delivery was finally scheduled for the start of 2010. At present, the official schedule is that Butantã and Pinheiros Stations are to be opened in July, and those of Luz and República in December, with the possibility that such inauguration dates could be brought forward by two months. The second phase, with Fradique Coutinho, Oscar Freire, Higienópolis, Morumbi and Vila Sônia stations, has now been pencilled in for the end of 2014.
The pre-qualification process for the companies interested in the construction of the stations of the second phase is currently under way and 17 consortiums have sent in the documents, so far. There is, as yet, no set date for the bidding process to be officially launched.
The tender for Line 5 of the São Paulo Subway, for the section between Largo Treze and Chácara Klabin, dogged with allegations of fraud, will now be annulled and redesigned. Yesterday was the end of the time frame for the companies involved in the plot allegations to make their defence, and Mr Alckmin should announce his decision about this tender by February 10th. Until then, the companies will be summoned by the Government to be heard. However, the Governor will probably hold a new tender process to avoid any negative political consequences. This is a political issue, says Mr Fernandes. The work should be delayed by at least one year and will now only be delivered in 2015, which is one year after the World Cup, in which São Paulo is one of the host cities.
Apart from the delay in the delivery of the work, the Government has also complained about the costs they will have to bear in the light of this problem. Mr Alckmin should prepare a new contract for the demolition of the houses that will be compulsorily purchased for this work, as the current contract is linked to the tender. There is another major headache: the expropriated houses are being looted. We will have to construct a wall to prevent people from stealing the materials, says Mr Fernandes.
The hiring of the companies that would carry out the work on Line 5 was suspended at the end of 2010, after a tip-off that the winners of the tender were known six months before. The State Board of Courts has investigated the case and found evidence of collusion between the winners of the tender.
According to Mr Fernandes, the State Government will concentrate the financial investment planned for Line 5 on the work on Line 4, running behind schedule.
In the package of development work by the State Government, there are also plans for four regional trains connecting the State Capital to the cities of Campinas, São José dos Campos, Sorocaba and Santos. It will be highly unlikely that these projects will be ready by the end of the Alckmin Administration, in 2014. According to the secretary, only Campinas and São José dos Campos could receive the services. The Government is awaiting the decision of the Federal Government about the bullet train to co-ordinate its own project with the Federal Project and use the same route.