 "MIAL plans to levy development fee to finance two Metro stations worth Rs 518 cr")
The Metro III, which entails an investment of Rs 23,136 crore, is expected to be commissioned by 2018-19.
The proposed development fee will be in addition to the development fee of Rs 100 for domestic and Rs 600 for international passengers approved by AERA between January 2013 and April 2021.
MIAL proposes to collect Rs 518 crore from the passengers from January 2016 to March 2024. The company has submitted the schedule for payment to MMRC for the entire Rs 518 crore cost — construction cost of Rs 400 crore and engineering and maintenance cost of Rs 118 crore. MIAL proposes to contribute funds towards the development of the third Metro rail station at Sahar Road through real estate infrastructure deposit. The payment for the two Metro rail stations funded through development fee would be completed by 2019-20, while for the third station, it would continue till 2023-24.
The company said in its petition it was already highly leveraged and there was no scope for raising further debt to fund the contribution of Rs 518 crore towards the cost of the Metro rail project. MIAL wants to maintain separate accounts for its approved development fee collection of Rs 3,400 crore and the proposed Metro rail development fee collection of Rs 518 crore. It also sought to review periodically for appropriated determination of cut-off date to discontinue the development fee.
An MMRC official said MMRC and MIAL have agreed upon the payment schedule, according to the memorandum of understanding dated September 16, 2015, which is to be used for the computation of development fee.
“Since it is not possible to fund this project from any further debt, equity or any other means, it is a fit case where the cost of this project is funded through development fee as per the provisions of section 22A of the AAI Act, 1994; the amount will be determined by AERA,” MIAL said in its petition.
According to MIAL, it is required to collect additional development fee in respect of the metro connectivity project till April 2021-co-terminus with collection of existing development fee period.
AERA has released a consultation paper based on MIAL's petition seeking feedback from the stake holders till November 26. AERA has signaled that it proposes to consider January 1, 2016 as the start date of proposed levy of development fee.
On its part, AERA said it proposes to consider an approximate split of 1:6 between domestic and international embarking passengers for the additional development fee, subject to rounding off of the calculated development fee levy amounts.
According to AERA, the estimated development fee levy is determined to be Rs 68.75 for international passengers and Rs 11.50 for domestic passengers.
AERA admitted that the development receipts in the initial few years (during 2015-16 and 2020-21) will be less than the expected payment outflow to MMRC whereas for the rest of the years (during 2021-22 and 2023-24) it is expected to be more than the required amount of development fee.
MIAL’S METRO CONNECTION
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MIAL & MMRC reached an agreement on financing of three Metro stations, which are part of Mumbai Metro III corridor
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Proposes development fee of Rs 50 per embarking domestic passenger, Rs 100 per embarking international passenger
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Rs 518 crore to be collected to finance construction of two Metro stations, while third to be developed by mobilising fund through real estate infrastructure
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Proposed development fee will be in addition to existing development fee of Rs 100 for domestic and Rs 600 for international passengers approved by AERA
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AERA plans to consider January 1, 2016, as the start date for the development fee and March 31, 2024, as the current estimated end date of additional development fee levy
- AERA says estimated development fee levy of Rs 68.75 for international passengers and Rs 11.50 for domestic passengers
