Israel’s Finance Committee has approved the request of deputy Prime Minister and Minister of Finance Silvan Shalom to budget 1.4 billion Israel shekels in spending authorization to develop the Jerusalem light train project.
The decision of the Minister of Finance paves the way for signing the concession agreement to build and operate the first line of the light train. CityPass is the tender’s winning consortium. Within this framework, the private concessionaire will build the light train in Jerusalem, some 14 kilometers in length, and will operate it for 30 years.
In order to choose the entrepreneur, a tender process was held, starting with the pre-qualification stage with the participation of six candidate groups. Out of these, five were chosen to continue the process.
The essence of the competition in the tender centered on the size of the grant requested from the state, to return that portion of the investment which is not covered in the income flow expected from the project.
In October the CityPass consortium was chosen as the preferred bidder. The group comprises of train manufacturer Alstom, railway operating company Vivendi, Israeli infrastructure company Ashtrom and the Israeli investment house Pollar. As part of the tender the preferred bidder submitted a request for a grant in the amount of NIS 1.406 billion, which constitutes about 74 percent of the private investment cost.
The entrepreneur's total investment in the project is estimated at some NIS 1.9 billion. The cash payment is expected to be paid during the course of 2006. The Jerusalem Municipality will cover 30 percent of the costs of the infrastructure of the building grant spread annually, according to the agreement between the municipality and the government.
In addition to the concessionaire's investment and the government and municipal grant, some NIS 500 million will be invested from the budgets of the Ministry of Transport and the Jerusalem Municipality to promote the accessibility of the project, to remove obstacles, to move infrastructure and to pay compensation, in order to clear the path for the train and to place it at the disposal of the concessionaire on the date set to start building the project. — (menareport.com)
© 2002 Mena Report (www.menareport.com)
