Toll Roads

Toll Roads............................................................................................................................2
1 Global...........................................................................................................................2
1.1 Several countries studies........................................................................................2
1.2 Finland...................................................................................................................3
1.3 Norway..................................................................................................................3
1.4 U.S.A.....................................................................................................................4
2 Latin America & Caribbean.........................................................................................4
2.1 General...................................................................................................................4
2.2 Mexico...................................................................................................................5
2.3 Argentina................................................................................................................6
2.4 Brazil......................................................................................................................7
3 East Asia & Pacific.......................................................................................................7
3.1 General...................................................................................................................7
3.2 China......................................................................................................................7
3.3 Indonesia..............................................................................................................10
4 Congestion Pricing.....................................................................................................10

Toll Roads
Numerous studies and projects about toll roads have already been done in the World
Bank, including some external articles. A list is available on the internet, given by the
LAC-Asia Infrastructure Resource Center. The IRC collects and disseminates information
to Bank staff in various media formats. The references of articles are listed below by
region and country from the most recent to the older one. An ID number is given for each
text coming from the World Bank, it allows to find quickly the correspondent text.
Articles are available on internet at the following location:
http://ispace.worldbank.org/cgi-bin/frameit.fcg?http://lcc.worldbank.org/irc/
Choose all materials, then material database, view by # and use previous and
next buttons to reach the ID number of the material you want to read.
Articles from external sources are mentioned and their references are given.
1 Global
1.1 Several countries studies
History of toll roads
Site of Toll Roads the Newsletter of Tolling Turnpike Bridges and Tunnel
By Peter Samuel
http://www.tollroads.com/history.htm
The Toll Roads newsletter is a publication specializing in tolling, describing this
emerging service business and keeping up with the debates and controversies. It Provides:
descriptions of new toll projects around the world, analysis of political, legal and
economic problems of toll projects, news of the successes & shortcomings of new toll
technologies, reports on ongoing operations of toll agencies and projects. It contains news
and analysis illustrated. It is an unsubsidized journalistic venture. Most articles contain
contact information for the reader to pursue a lead.
Disappointing Returns at the Toll Booth
ID No. 728
By Rupert Bruce, 1996, WB Region: Global, Country: Argentina, Brazil, Hungary,
Malaysia, Mexico, Panama, United States
Project financing on a purely commercial basis for toll roads may not be viable, traffic
forecasts represent major risks for private operators. Public-private partnerships may be
needed. Hungarys M1attracted only 50% of the traffic projected. Similarly, a number of
toll roads projects that have been beset with problems in countries: Malaysia; Mexico,
Brazil, Argentina, Panama and in the US too, are listed.

1.2 Finland
First Shadow Toll Project Realization Begins in Finland
ID No. 1905
Risto Pelttari, 1997, WB Region: Global, Country: Finland
A semi-motorway section between Helsinki and Lahti is upgraded into a motorway by
using shadow tolls. This FinnContact issue reveals facts that led to the signing of the 15
years DBFO agreement last month (4/97).
1.3 Norway
The Norwegian Public Roads Administration Sr-Trndelag
By The Norwegian Public Roads Administration, 1998.
http://www.aksess.no/vegvesenet/concert/index_eng.html
This site contains explanations about:
Concert: a wide ranging research program in eight European cities: Trondheim,
Barcelona, Marseille, Bristol, Hanover, Dublin, Bologna and Thessaloniki, within the
field of information technology / road transport telematics
Tron: a research project in Trondheim : a system for integrated payment of several
transport services.
Pak: project to try out measures to aid buses and street-cars in the city traffic.
Tron 2: a national test of road pricing as a part of the CONCERT program. The test
results are therefore applicable not only to Trondheim and its traffic problems.
Transport telematics: newsletter issued by The Public Roads Administration Traffic
department. Purpose: Use of technology and telecommunication in vehicle, and
infrastructure, to improve safety, efficiency, comfort and environment associated with
road transport.
The Trondheim Toll Ring : Avoiding the Trolls of Tolls
by Richard Cook, M.C.I.P., R.B. Cook Consulting, from a seminar led by Mr. Tore
Hoven, Head of Traffic Management, Public Roads Administration, County of SorTrondelag, Norway. 1996.
http://www.islandnet.com/ITE_BC/Jan96_trondheim.html
This article describes the integrated transportation plan for Trondheim, the original
objectives of the Trondheim Toll Ring. It explains how it works, the toll pricing, the toll
collection, the reasons of public acceptance and concerns. It also presents the future of
this system.
FHWA Congestion Pricing Team Uses Real-World Experience
Web Site of :Turner-Fairbank Highway Research Center, Research & Technology
Transporter. Article by Tom Keane, July 97.
http://www.tfhrc.gov/trnsptr/rttjul97/tr797p4.htm
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Illustrated article about the Trondheim toll ring public success. The importance of public
transport improvement is underlined.
Congestion Pricing: Trondheim Toll Ring Developing Sectors
By Peter Samuel, December 18,1996. From the Toll Roads Newsletter, The Newsletter of
Tolling Turnpikes Bridges & Tunnels. ( Cf. History of Toll Roads).
http://www.ettm.com/news/tollroads_trondheim.html
Article about the necessary refinements of the Trondheim toll ring, and the absence of
harmful economic results.
Toll Ring Oslo, Norway -Road pricing in an urban area
by Beture Setame (September, 1994). Revision by EURONET, 1996. Site of
International council for Local Environmental. Case description from European
Commission, Expert Group on the Urban Environment.
http://www.iclei.org/egpis/egpc-044.html
The Oslo Toll Ring experiment constitutes one of the first functioning road pricing
projects in the world which has been put into practice in an urban area. Electronic toll
stations register the traffic on access roads to the city center. Benefits in terms of traffic
regulation and environmental advantages have been achieved in addition to the financial
returns of the project. Control of atmospheric pollution and improvements in air quality
are mentioned.
1.4 U.S.A.
Texas Panel Revives Toll Road Project at Mexican Border
ID No. 404
Kevin G. Hall, 1996, WB Region: Global, Country: United States
The issue of mandating use of private toll road from Laredo in Texas to Mexico border,
finds truckers unwilling and vow to fight back. This article is from The Journal of
Commerce, April 12, 1996.
Road pricing : The variable toll road California, the toll ring Trondheim, Norway.
1997, Site of Transport 2000 : a volunteer consumer movement opposing the destruction
of the environment by over-reliance on roads and promoting public transportation.
http://www.vcn.bc.ca/t2000bc/background/tech/road_pricing.html
Illustrated article about the advantages of congestion pricing through the Californian and
Norwegian examples.
2 Latin America & Caribbean
2.1 General
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 Privatizing RoadsA New Method for Auctioning Highways

ID No. 1424
Eduardo Engel, Ronald Fischer, and Alexander Galetovic, 05/01/97, WB Region: Latin
America & Caribbean
Many of the problems that have plagued highway privatization stem from the combined
effects of special features of the highway business and the type of contracts fixed term
franchises that have typically been used. A new mechanism is proposed: the leastpresent-value-of-revenue (LPVR) auction, that corrects some of the shortcomings of the
fixed term franchise. The new mechanism endogenously adjusts the duration of the
franchise to the realization of demand: the term lengthens if traffic grows more slowly
than expected and shortens if it grows more rapidly than expected. PSD Note No. 112.
2.2 Mexico
The Tribasa Toll Road Trust
ID No. 2335
Jay H. Walder, 1998, WB Region: Latin America & Caribbean, Country: Mexico
With construction completed on two of its toll road concessions, Grupo Tribasa, S.A. de
C.V. (Tribasa), one of the largest construction companies in Mexico, sought to arrange
long-term financing for those roads on the international capital markets. The financing
was to be secured by the toll revenues, which were estimated to be about N$70 million in
1994 and were expected to grow throughout the term of the concessions. They need to
remove the equity investment and debts from their balance sheets so that they can invest
in other projects.
Mexicos Private Toll Program
ID No. 2353
Jose Gomez-Ibanez, 12/01/97, WB Region: Latin America & Caribbean, Country:
Mexico
Mexicos experience had not reduced interest in private concession toll roads elsewhere
in Latin America, Asia, or Eastern Europe. In 1997, most industrializing countries in the
world faced the same problems that had led Mexico to use private concessions: growing
traffic and highway needs but limited ability or willingness of the public sector to take on
additional debt to build roads. As a result, virtually all the expressways that had been
built in developing countries during the 1990s were built as private toll road concessions.
Chile, for example, began auctioning concessions to upgrade 1,570 kilometers of the Pan
American Highway to full expressway standards in 1996. The challenge for these other
countries, then, was to learn from Mexicos experience in designing their concession
programs.
A Retrospective on the Mexican Toll Road Program (1989-94)
ID No. 1711
Jeff Ruster, 09/01/97, WB Region: Latin America & Caribbean, Country: Mexico
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In 1989, Mexico initiated a private toll road program of fifty-three concessions involving
an investment of about US$13 billion in limited recourse financing over the period 198994. The program more than doubled the size of the national toll road network, but
miscalculations of investment costs and overoptimistic forecasts of operating income
undermined the viability of the toll roads. An already bad situation was made worse by
the Mexican currency crisis of December 1994, and the private toll road initiative came
to a virtual standstill. Local commercial banks were saddled with non-performing loans
estimated at US$4.5 billion to US$5.5 billion. Concessionaires and their affiliates have
been faced with writing off large portions of their investments. And users were left with
some of the highest tolls in the world. Jeff Ruster diagnoses the flaws in the design of the
program and shows how the failure was manifested in the implementation of different
phases of the projects. This Note presents a diagnostic of key policy, regulatory, and
institutional gaps that undermined the financial equilibrium of the sector. A checklist of
recurrent problems illustrates how the failure to address these issues manifested itself in
the course of implementation. PSD Note No. 125.

Financing Infrastructure Projects in the International Capital Markets: The Tribasa

Toll Road Trust
ID No. 1147
By Peter V. Darrow, Nicole V. F. Bergman Fong, J. Paul Forrester Mayer, Brown & Platt,
1994, WB Region: Latin America & Caribbean, Country: Mexico
The Tribasa Toll Road financing is a good illustration of the fashion in which the
international capital markets can be used to obtain financing for infrastructure projects,
and reflects creative solutions in structuring such a financing to address common
concerns of institutional investors. Taken from The Financier: ACMT, Vol. 1, No. 3, pp.
9-19.
40 Cents a Mile to Acapulco
ID No. 1020
The New York Times, 1993, WB Region: Latin America & Caribbean, Country: Mexico
At an average of 40 cents a mile toll fee, the road between Acapulco to Mexico city is the
most expensive in the world. Although the driving time is reduced to half, the high toll
fee is preventing the drivers to use the road. The New York times, august 15, 1993.
2.3 Argentina
The following article is available at the location:
http://www-lite.worldbank.org/fpsi/infra/anchor/publicat/pubframe.htm
Designing Toll Road ConcessionsLessons from Argentina
Antonio Estache and Jos Carbajo, December 1996
Argentina began to concession its intercity highways and the access roads to Buenos
Aires in the early 1990s. It first offered the intercity highways for competitive bids,
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setting the terms, the tolls, and the service levels and basing bid selection primarily on the
rental offered for the infrastructure. When it concessioned the access roads in a second
round, it set the terms and the investments and selected the bid offering the lowest tolls.
The results so far have been mixed. Investment has lagged, but maintenance of the
intercity highways has improved. Antonio Estache and Jos Carbajo review the lessons
from this experience and identify some of the challenges for future concessions:
following clear and simple rules in the bidding process, establishing clear rules for
renegotiation, and strengthening regulatory capacity.
2.4 Brazil
Sao Paulo Sells Road Concession for R$1.85 bn.
ID No. 351
Jonathan Wheatley, 1996, WB Region: Latin America & Caribbean, Country: Brazil
Financial Times article on first privatization of 22 road concessions in Sao Paulo state in
Brazil. The winner will improve the toll roads condition and expand it. The states
privatization program includes electric sector generating and distribution concessions.
3 East Asia & Pacific
3.1 General
Too Long a Road to Asia
ID No. 1823
Mary Watkins, 09/15/97, WB Region: ASIA
The Asian currency devaluation is affecting projects in the region. Governments and
bankers are reassessing the risk profile of their projects. In a difficult market the first
deals to be postponed are likely to be the projects that financiers and sponsors have more
difficulty pushing through. One of the first casualties are road projects with their related
tunnel and bridge developments. Source: Project & Trade Finance Database, September
15, 1997.
3.2 China
Capital Markets Financing of Toll Highways in China
ID No. 1347
Alfred Nickesen, Mitchel Stanfield, 1997, WB Region: East Asia & Pacific, Country:
China
Demand for Private Investment in Toll Highways, Principal Impediments to Private
Financing in the Highway Sector, The First Private Project: Hopewells Guangzhou
Shenzhen Superhighway, Asset-Based Capital Markets Toll Highway Financing, Future
Prospects for Securitized Toll Highway Financing Techniques.
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 Innovative Capital Market Toll Highway Finance in Guangdong Province, China

ID No. 1763
Alfred Nickesen, Mitchel Stanfield, 1997, WB Region: East Asia & Pacific, Country:
China
Guangdong provinces exceptional economic and trade achievements during the last
decade, lies in the flexible open-door policies, market reforms, being one of the four
special economic zones and its geographical as well as cultural and commercial
proximity to Hong Kong. The provincial government has earmarked about US$30 billion
to be invested in developing transport infrastructure during 20 year period from 1991 to
2010.
Zhejiang Expressway Company Limited: Placing and New Issue
ID No. 1654
Hoon Mok Chung, 1997, WB Region :East Asia & Pacific, Country: China
This document presents the placing and new issue of H shares by Zhejiang Expressway
Co., Ltd. Areas addressed by the document include the timetable for placement of shares
and company information including financial, historical, and operational information.
Accountants reports, consultant and engineering study results are also included.

The Evolving Policy Framework for World Bank Supported Private Toll Highway
Financing in China
ID No. 1757
by Alfred Nickesen, 1997, WB Region: East Asia & Pacific, Country: China
This paper summarizes the ongoing development of Chinas highway program, with
emphasis on the issues involved in private financing and World Bank support for and
participation in these projects. Part 1 of the paper gives a brief summary of World Bank
highway lending to China. Parts 2 and 3 deal with the recent phenomenon of asset
securitization of toll highways and World Bank participation in these transactions. Parts 4
and 5 describe the World Banks role in the evolving BOT policy framework and Chinas
first pilot BOT project in the highway sector. Part 6 contains conclusions and a summary
of the future direction of Chinas highway program.

A New Direction Asian Toll Roads Have Been Littered with Financial Disasters,
But This Summer Saw a Spate of Project Company Listings
ID No. 1025
by Infrastructure Finance, 1996, WB Region: East Asia & Pacific, South Asia
In Asia, traffic growth rates are much higher than projected by foreign traffic consultants
in relation to economic growth. The Asian governments are hoping to finance many of
their new toll road projects by private sector participation. However, transportation
projects are still one of the most difficult sectors to finance, therefore, it remains at the
bottom of the list for most investors.
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 Standard Concession Agreement for Toll roads

ID No. 1315
Blake Dawson Waldron, 1996, WB Region: East Asia & Pacific, Country: China
Model concession agreement for private sector companies constructing tollroads for the
Chinese government. This agreement is to be the model for build-operate-transfer (BOT)
concessions with terms up to thirty years. Project specifications, schedules, and designs
are to be included with the agreement, although examples are not provided with this
document.
Model Procurement Documents for Private Toll Highways
ID No. 1470
Blake Dawson Waldron, 1996, WB Region: East Asia & Pacific, Country: China
Chinese and English. This report compiles procurement documents including, Request
for Prequalification, Request for Proposals, Standard Concession Agreement for Toll
roads, and Competitive Bidding Procedures for BOT Highway Projects. A
presentation on the Blake Dawson Waldron involvement in BOT infrastructure projects
as well as a discussion of BOT procedures is provided.

Issuance of B-Shares on Shenzhen Stock Exchange for Fo-Kai Expressway: A Model

for Innovative Toll Highway Finance in China and Elsewhere?
ID No. 1753
Alfred Nickesen, 1996, WB Region: East Asia & Pacific, Country: China
This paper examines the recent case raiding funds to support counterpart funding
commitment for Fo-Kai Expressway and further outlines several new financing sources
toll highways.
Asset-Based Financing of Toll Highway Projects in China
ID No. 1758
Alfred Nickesen, Mitchel Stanfield, 1996, WB Region: East Asia & Pacific, Country:
China
In order to achieve the highly ambitious National Trunk Highway System as set out in the
five year plan (1996-2000), Ministry of Communication (MOC) recognized the need for
new center-provincial relationships and innovative financing methods, in addition to
identified private sector participation. The criterias were established for utilizations of
Bank financed assets for future share offerings.
The Evolving Framework for Private Toll Highway Finance in China
ID No. 1764
Alfred Nickesen, Mitchel Stanfield, Tomoko Matsukawa, 1996, WB Region: East Asia &
Pacific, Country: China
This paper provides a useful insight into Chinas toll roads infrastructure development
program and the use of various innovative financing instruments to fund different
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provincial highway programs. The size of this program as noted, in terms of distance and
cost well exceeds any similar toll road program now underway in the world. The main
question is how should China proceeded to develop a workable project finance model for
highway development.
SPC Model Documents for BOT Toll Highway Projects
ID No. 1779
by: Alfred Nickesen, 1996 WB Region : East Asia & Pacific, Country: China
This memorandum addresses the model documents generally, with observations on the
package and approach, discussion of the key issues, and specific recommendations on the
separate bid documents and standard concession agreement. As an annex to the memo,
there is a section-by-section summary of legal issues and recommendations which
resulted from the Bank-wide review.

Draft Terms of Reference for Model Bidding Documents, Standard Concession

Agreement, and Procurement Procedures for BOT Toll Highway Projects in China
ID No. 739
By: Alfred Nickesen 1995, WB Region: East Asia & Pacific, Country: China
Terms of reference for preparation of BOT documents and procedures for highway
projects in China by a team of consultants. The chosen consultants will develop a
procedure for recruitment and evaluation of proposals, model bidding documents, and a
standard concession agreement for toll highway projects with private financing. Within a
twelve week timeframe, the consultant team is to deliver a procurement timetable, a
competitive procurement procedure, a model request for qualifications, and a request for
proposals, and a standard concession agreement.
3.3 Indonesia
Indonesia: Effective Private Participation in Toll Roads
ID No. 1307
1996, WB Region: East Asia & Pacific, Country: Indonesia
A study addressing issues related to increasing private participation in Indonesian toll
roads. The paper discusses Indonesias use of BOT concession approaches, jointventures, the privatization of the national transportation company (Jasa Marga), and
competitive concessioning of existing toll roads to increase private participation. The
study presents project risk-sharing for toll road project sponsors and the Government of
Indonesia (GoI). Includes recommendations for GoI actions to increase private
participation.
4 Congestion Pricing

A Brief Description of Congestion Pricing

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By Julie Cidell for The State and Local Policy Program (SLPP). It is a research center at
the Hubert H. Humphrey Institute of Public Affairs within the University of Minnesota.
http://www.hhh.umn.edu/Centers/SLP/Conpric/short.htm
Congestion pricing is viewed by Transportation policy makers and economists as an
important part of the solution to growing highway congestion in urban areas. The
difficulties to determine optimal congestion prices and the problem of public acceptance
are considered.
Primer on congestion pricing
By David S. Dahl, Economics Editor, 1996, USA, in the letter of The Federal Reserve
Bank of Minneapolis: Fedgazette.
http://woodrow.mpls.frb.fed.us/pubs/fedgaz/fg964c.html
While population projections point toward increasing demands on the nation's
infrastructure and public facilities, many people oppose their expansion. Economic theory
provides a method to proof the necessity and the utility of congestion pricing.
Safety Benefits of Traffic Calming
ID No. 1107
By G.D. Hamilton Associates Consulting Ltd., 1996, WB Region: Global, Technical
Papers
Traffic calming, is defined as a method or combination of methods to physically and
visually impede speeding and the use of local roads by non residents to avoid congested
arterial routes. It is also known as neighborhood traffic control, traffic restraint, local area
traffic management, and environmental traffic management, is being employed
extensively. This study is to determine the positive impacts in terms of reduction in
collisions, environmental and other social benefits.

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