Public markets and shopping centers are two of the most preferred projects by LGUs for PPP implementation because of their high commercial value. The projects are usually done under a BOT arrangement. Under this arrangement, the private proponent builds and operates the facility over a fixed term during which it is allowed to charge a fee to facility users. The proponent will transfer the facility to the LGU after the agreed fixed term, not exceeding 50 years. Below are highlights of the proponent and the LGU's responsibilities.
Private Proponent | |
● Design, finance, build and operate and maintain the facility ● Provide construction warranties and operation performance bond ● Collect fees, rentals and other charges not exceeding the amounts proposed in the bid | ● Issue exclusive franchise ● Provide site for the public market ● Provide tax incentives such as deferment of real property and business taxes ● Collect the necessary taxes and fees from, and issue licenses and permits to business establishments operating in the public market. ● Provide termination/buy out payment if contract is cancelled due to LGU's fault |