Royalty Models for the BOT Projects of Transportation Infrastructures
|關鍵字:||BOT計畫;權利金計收模式;數學規劃模式;BOT;Royalty Models;Mathematical programming|
Private participation has already become a major financial impetus in promoting the construction of transportation infrastructure in Taiwan. However, the government agencies involved often find it difficult to set the royalty when putting out requests for private investment. At times, during the process of negotiation with investors, it is almost impossible for the agencies to sign a reasonable royalty without recognizing the bottom line of the royalty. Basing on this, we propose a mathematical programming model, from government's point of view, considering certain rate of return for investors and debt redeeming requirements for financiers, in order to calculate optimal annual royalty during the concession period based on the financial model of the BOT project. Since the optimal annual royalty is calculated based on abovementioned mathematical and financial models, there is no simple and clear formula can be used as the basis for invitation for bidding and negotiation for signing contract. Consequently, this study further considers some frequently used premium bases (farebox, ridership, total revenue, profit) and collecting methods (one segment, two segments, multi-segments with ascendant slopes, multi-segments with descendent slopes) to develop a total of sixteen distinct royalty collection combinations. Besides, two non-premium-based collecting methods are also considered, that is, annual fixed amount royalty and lump sum royalty, to make a total of eighteen royalty collection methods. Incorporating these eighteen methods into above royalty model, the optimal annual royalty for each collecting method can be determined. Moreover, for the cases with insufficient self-liquidating ratio, this study also proposes two models for royalty collection which government provides subsidies, including operating subsidy (annual payment during concession period) and capital subsidy (one-time payment in the beginning of concession period). In validating the feasibility of our model and the appropriateness for various collecting methods, we design three exemplified BOT projects, with their self-liquidating ratios greater than 1, less than 1 and equal to 1, respectively. And then we employ scenario analysis and sensitivity analysis to discuss the differences among these methods. In additions, the needed subsidies provided by government are also calculated. Finally, a case study of a BOT project of parking building in Taipei is conducted. The result shows that of the fourteen royalty methods (since there is no subsidiary revenue for this project, the methods based on the premium of farebox and total revenue are all the same), the method of multi-segments with ascendant slopes based on pre-tax profit is optimal. However, the royalty calculated by this method is still 38% less than the annual optimal model’s. A simulation analysis is also conducted to explore the amount of royalty fluctuations under uncertainty environments (assuming that annual patronage is distributed as normal distribution with standard deviation equal to 20% of its mean value of that year). The result shows that there are 13% situations falling below the rate of return required by investor and 24% situations falling below the ratio of debt service coverage required by financiers.