THE DEVELOPMENT OF NONCONTINGENT GOVERNMENT SUPPORTS ON TOLL ROADS WITH SUPPORTED BUILD OPERATE TRANSFER (SBOT) SCHEME IN INDONESIA

• Main Author: MAHANI, IRIS
• Format: Dissertations
• Language: Indonesia
• Subjects: Teknik sipil
• Online Access: https://digilib.itb.ac.id/gdl/view/28131
• Institution: Institut Teknologi Bandung

The quality and quantity improvement of road infrastructures in supporting national connectivity is a priority for Indonesia's development to promote economic growth. Therefore, the Indonesian government encourages the cooperation between government and business entities (KPBU) in the provision of toll roads. From 1978 to 2017, there was only 1064 km of toll roads operating. Investors are less interested in investing in toll roads because generally the development of toll roads is less feasible financially when using the Build Operate Transfer (BOT) scheme. Hence, toll roads that financially are not feasible should use the scheme of Supported Build Operate Transfer (SBOT). The purpose of this research is to develop noncontingent government supports on toll roads using SBOT scheme in Indonesia. <br /> <br /> The scope of the dissertation includes: a) Determining the appropriate MARR for toll road investment in Indonesia, b) Identifying factors affecting financial feasibility, c) Analyzing support alternatives, d) Analyzing potential areas of SBOT, e) Analyzing the risk of support and e) Formulate risk mitigation <br /> <br /> The method used is a combination of qualitative and quantitative. To determine the Minimum Attractive Rate of Return (MARR), the correlation method, CAPM and IRR gap on interest rates, to determine effective support and potential areas of SBOT are used for case studies on unreasonable toll roads, while in determining support characteristics, risks and mitigation qualitatively based on interview / questionnaire. For risk analysis and mitigation include the following stages: 1) The process of each support, 2) Identification of risk of each stage, 3) description and preliminary screening, 4) Qualitative and validation risk analysis, 5) Mitigation and validation formulation, 6) Mitigation alternatives on the basis of regulation, institutions, business processes and competencies. <br /> <br /> Based on the results of a review, Minimum Attractive Rate of Return (MARR) on a reasonable toll road is 3.58 above the investment rate. From the results of both quantitative and qualitative analysis, the potential supports for the SBOT scheme are construction grant, partial construction, revenue subsidy / operation grant, and combination of construction and operation grant. <br /> <br /> General recommendations for mitigation of support risks include: a) Regulatory aspects: the need to evaluate the maximum limit of supports and to improve or complement the ministerial regulations regarding the supports; b) Institutional aspects: the need for a special BLU to accommodate budgets in the Ministry of Finance, a special unit in BPJT to deal with VGF issues, and a BPJT facilitation team in drafting the document for guarantee submission; c) Aspects of competence: the need to increase the creativity and competitiveness of construction services in Indonesia, and d) Business process aspects: the need to improve coordination among related sectors, cooperation with DPR, socialization of toll road benefits for regions, evaluation of tariff plans, and transfer of some risk to PT PII.. Mitigation recommendations are specifically intended on: a) partial construction supports that include: (1) the need for a government regulation of PUPR as an implementation guideline, (2) Improvement of BPJT roles in arrangements of construction contract, progress and quality control, (3) Increase socialization to BUJT, 4) Implementation of government construction contract through design build, (5) Improvement of field supervision by Bina Marga and team of the Constitutional Court, (6) tightening of procurement process; b) operation grant support that only supports projects requiring limited supports, and c) combination of construction and operation grant support that is given only for force majeure. The academic contributions of this study include the provisions of methods for evaluating the effectiveness of feasibility support forms (VGF), methods for comparing feasibility support alternatives (VGF) and methods for identifying the risk of support implementation. The practical contributions of this research is to provide inputs for the government in policies determination relating to support provision on toll road investment, inputs to the government on effective support in SBOT scheme to expand toll road development in Indonesia, and inputs for toll road business entities (BUJT) in Indonesia in determining the MARR. <br />