103085 BULGARIA ROADS INFRASTRUCTURE AGENCY National Tolling Framework for Bulgaria Advisory Services to the Roads Infrastructure Agency to Enhance Road Sector Management, Capacity, Operational and Financial Robustness, and Increasing the Absorption of EU Funds October 2015 European Union FISCAL YEAR January 1 – December 31 Country Manager: Antony Thompson Practice Manager: Juan Gaviria Task Team Leader: Rakesh Tripathi DISCLAIMER This report is the product of the staff of the World Bank. The findings, interpretations, and conclusions expressed in this report do not necessarily reflect the views of the Executive Directors of the World Bank or the governments they represent. The report was produced to provide advisory support for the Road Infrastructure Agency (RIA) and does not necessarily represent the views of Government of Bulgaria or of the RIA. I Table of Contents ACRONYMS AND KEY TERMS..............................................................................................................................................................................................................IV EXECUTIVE SUMMARY: NATIONAL TOLLING FRAMEWORK FOR BULGARIA............................................................................................................1 PART 1: INSTITUTIONAL MODEL, TECHNOLOGY, LEGAL AND PROCUREMENT ISSUES AND INTEROPERABILITY.......................... 11 SUMMARY..................................................................................................................................................................................................................................................... 12 1 INTRODUCTION.................................................................................................................................................................................................................................... 14 2 THE INSTITUTIONAL MODEL......................................................................................................................................................................................................... 16 3 TECHNOLOGY AND OPERATIONAL MODEL........................................................................................................................................................................ 38 4 LEGAL MODEL....................................................................................................................................................................................................................................... 48 5 INTEROPERABILITY.............................................................................................................................................................................................................................. 55 6 NEXT STEPS............................................................................................................................................................................................................................................. 60 7 ANNEXES.................................................................................................................................................................................................................................................. 60 ANNEX A: DATA SHARING BETWEEN THE E-TOLLING/E-VIGNETTE SYSTEM AND EXTERNAL BODIES................................................. 61 ANNEX B: LEGAL CHANGES................................................................................................................................................................................................................ 64 ANNEX C: ENFORCEMENT OF FOREIGN VEHICLES............................................................................................................................................................... 75 ANNEX D: PRECEDING ANALYTICAL WORK.............................................................................................................................................................................. 79 Annex E: Etolling Case Studies........................................................................................................................................................................................... 84 PART 2: DRAFT MASTER PROJECT MANAGEMENT PLAN (INCLUDING A DRAFT PROJECT CHARTER)................................................. 97 SUMMARY..................................................................................................................................................................................................................................................... 98 1 INTRODUCTION................................................................................................................................................................................................................................. 101 2 PROJECT INITIATION PHASE....................................................................................................................................................................................................... 105 3 PROJECT PLANNING PHASE...................................................................................................................................................................................................... 106 4 PROJECT EXECUTION..................................................................................................................................................................................................................... 109 5 PROJECT MONITORING AND CONTROL............................................................................................................................................................................ 111 6 PHASE CLOSE-OUT AND LESSONS LEARNED................................................................................................................................................................. 113 7 PROJECT SCHEDULE....................................................................................................................................................................................................................... 114 8 PROJECT GOVERNANCE AND ORGANIZATION STRUCTURE................................................................................................................................. 119 ANNEX A: WORK BREAKDOWN STRUCTURE......................................................................................................................................................................... 121 ANNEX B: DRAFT PROJECT CHARTER........................................................................................................................................................................................ 124 ANNEX C: PROJECT SCHEDULE..................................................................................................................................................................................................... 131 ANNEX D: PROGRAM WITHOUT SPECIAL PURPOSE ENTITY....................................................................................................................................... 133 PART 3: FINANCIAL ANALYSIS......................................................................................................................................................................................................... 135 1 INTRODUCTION................................................................................................................................................................................................................................. 136 2 FINANCIAL MODEL ARCHITECTURE..................................................................................................................................................................................... 137 3 FINANCIAL MODEL.......................................................................................................................................................................................................................... 138 4 RESULTS.................................................................................................................................................................................................................................................. 154 5 CONCLUSIONS................................................................................................................................................................................................................................... 160 II LIST OF TABLES Table 1. SWOT Analysis Summary.................................................................................................................................................................................................. 20 Table 2. Mapping of Knowledge Areas onto Project Phases for Delivery of Tolling in Bulgaria.......................................................... 103 LIST OF FIGURES Figure 1. Proposed SPE Organization Structure..................................................................................................................................................................... 18 Figure 2. Context Model with an SPE........................................................................................................................................................................................... 22 Figure 3. Context Model without an SPE................................................................................................................................................................................... 22 Figure 4. Options for Payment.......................................................................................................................................................................................................... 24 Figure 5. Semi-permanent MEU Designs................................................................................................................................................................................... 31 Figure 6. Tripod Temporary MEU..................................................................................................................................................................................................... 31 Figure 7. Evidence Capture Summary......................................................................................................................................................................................... 43 Figure 8. Main External Interfaces.................................................................................................................................................................................................. 46 Figure 9. User Model............................................................................................................................................................................................................................... 48 Figure 10. Stages in an Open Procedure.................................................................................................................................................................................... 52 Figure 12. Main Stages of Negotiation with Notice............................................................................................................................................................ 52 Figure 13. Revenue Projection, including GNSS for Light Vehicles............................................................................................................................ 80 Figure 14. Projection of Tolling at Lower Charges for Light Vehicles........................................................................................................................ 81 Figure 15. Summary of all Factors Impacting Strategic Options................................................................................................................................. 81 Figure 16. Proposed Vision.................................................................................................................................................................................................................. 82 Figure 17. Scope of PMBOK............................................................................................................................................................................................................. 102 Figure 18. Project Management Phases.................................................................................................................................................................................. 103 Figure 19. Project Initiation Phase............................................................................................................................................................................................... 105 Figure 20. Project Planning Phase............................................................................................................................................................................................... 106 Figure 21. Project Execution Phase............................................................................................................................................................................................. 109 Figure 22. Project Monitoring and Control Phase............................................................................................................................................................. 111 Figure 23. Phase Close-Out Phase............................................................................................................................................................................................... 113 Figure 24. Project Schedule Flowchart..................................................................................................................................................................................... 114 Figure 25. Main Tasks and Milestones....................................................................................................................................................................................... 116 Figure 26. Legislation to Establish an SPE............................................................................................................................................................................... 117 Figure 27. Change of Legislation for ETC and e-vignette............................................................................................................................................. 117 Figure 28. Procurement Process................................................................................................................................................................................................... 118 Figure 29. Proposed Project Organization Structure....................................................................................................................................................... 119 Figure 30. Work Breakdown Structure...................................................................................................................................................................................... 122 Figure 31. Technical Scope of the Project............................................................................................................................................................................... 128 Figure 32. Financial Model Architecture.................................................................................................................................................................................. 137 Figure 33. Financial Model structure......................................................................................................................................................................................... 138 Figure 34. Regional GDP Factors Used to Modulate the Bulgarian GDP Estimate Per NUTS2 Region............................................. 139 Figure 35. Traffic Estimation Process.......................................................................................................................................................................................... 140 Figure 36. Traffic (Total Annual km Driven) Per Network Scenario Divided by Emission Classes........................................................ 141 Figure 37. Road Network Data Table......................................................................................................................................................................................... 142 Figure 38. E-tolling Rates Table..................................................................................................................................................................................................... 143 III Figure 39. E-vignette Rates Table................................................................................................................................................................................................. 143 Figure 40. International Comparison of e-tolling Rates................................................................................................................................................. 144 Figure 41. International Comparison of e-vignette Rates............................................................................................................................................ 144 Figure 42. Vehicles Numbers (Historic and Forecast)...................................................................................................................................................... 145 Figure 43. Vignette Unit Sales........................................................................................................................................................................................................ 146 Figure 44. Vignette Prices in BGN................................................................................................................................................................................................. 147 Figure 45. Vignette Revenue in BGN.......................................................................................................................................................................................... 148 Figure 46. Vignette Border Sales in 2013 (Some Border Crossings Only)............................................................................................................ 149 Figure 47. Current and Forecasted e-vignette Units........................................................................................................................................................ 149 Capexrelative, Opexrelative and Transaction Cost for e-vignettes and Routes Passes Figure 48.  and Each Network Scenario.................................................................................................................................................................................... 150 Figure 49. System Cost and Operational Assumptions Module............................................................................................................................... 152 Figure 50. Revenue and Cost Processing................................................................................................................................................................................ 153 Figure 51. Net Present Values of the 18 Scenarios Evaluated..................................................................................................................................... 154 Gross Revenue, Cost and Net Revenue (implementation, 1st and last operational year) for the Three Figure 52.  Network and e-tolling Rate Scenarios and e-vignette Rate Option 1 in Mio. BGN............................................................... 155 Gross Revenue, Cost, and Net Revenue (implementation, 1st and last operational year) for the Three Figure 53.  Network and e-tolling Rate Scenarios and e-vignette Rate Option 2 in Mio. BGN............................................................... 156 Figure 54. NPV by Road Section Using Baseline Tariffs in Euro.................................................................................................................................. 157 Net Present Value Example of Total Revenue from e-tolling on RIA Road Network (Motorway + 1st + 2nd Figure 55.  + 3rd Class Road Network) Cumulated by Bulgarian NUTS2 Regions, Values in Euro........................................................ 158 IV Acronyms and Key Terms AADT Annual Average Daily Traffic NUTS Nomenclature of Territorial Units for AETIS Association of Electronic Toll and Statistics Interoperable Services OBU  n Board Unit – a device in a vehicle to O ANPR Automatic Number Plate Recognition locate its position and pass this onwards for collection of tolls and/or fleet CCTV Closed-Circuit Television or video management purposes. Typically uses surveillance GNSS CEDR Conference of European Directors of OD Origin and Destination Pair Roads KPI  ey Performance Indicator – a K DSRC  edicated Short Range Communications D contractual measure of success of the – a “tag and beacon“ based tolling outputs from a project – for example system with roadside infrastructure % vehicle accuracy or number of ECMT European Council of Ministers of complaints Transport PFI Private Finance Initiative EDRA European Debt Recovery Agency PMBOK Project Management Body of Knowledge EETS E  uropean Electronic Toll System – as (American Standard ANSI/PMI 99-001- defined by EU Directive to allow for 2013) interoperability between Toll systems PMP The Contractor’s Project Management EP EETS Provider Plan ETC Electronic Toll Collection PPL Public Procurement Law EUCARIS European CAR and driving license PPP Public Private Partnership Information System REETS Regional EETS – a project looking at a GIS Geographic Information System subset of EETS in EU regions GNSS/ CN G  lobal Navigation Satellite System / RIA Road Infrastructure Agency Cellular network. A toll system that Salzburg A cooperation initiative between the uses satellite systems such as Galileo or Forum Interior Ministries of eight European Global Positioning System so the vehicle countries can calculate its location, and cellular networks to send this location onwards SPE  pecial Purpose Entity – Government S to calculate tolls arm’s length one stop agency for tolling, acting as the Toll Charger HDM Highway Development and Management Model STMS Strategic Traffic Management System HGV A vehicle typically of greater than 12 ToR Terms of Reference tonnes MPGVW TP Tolling (data ) Provider ISO International Standards Organization VMS Variable Message Sign ISP I ndependent Service Provider – an VOSI Vehicle of Special Interest organization that provides a customer interface with the toll service IT Information Technology Government The Ministries of Bulgaria and RIA MEU Mobile Enforcement Unit – a vehicle that Toll Charger The legally defined body that collects monitors compliance with tolling tolls in Bulgaria MPP Master Project Management Plan Enforcement  he body with legal powers to stop T MPGVW Maximum Permitted Gross Vehicle Weight Body vehicles (if required), issue penalties for NPV Net Present Value non-toll payment and manage appeals NRA National Revenue Agency Contractor The single body appointed by NSP N  ational Service Provider – provides cus- Government and then managed by the tomer services for toll payers and OBUs if SPE who provides tolling infrastructure required, pays tolls to the Toll Charger and services and supports enforcement Executive Summary: National Tolling Framework for Bulgaria 2 Executive Summary 1. The Road to a Sustainable Road Network to 7 years. There is a critical need to ensure long-term in Bulgaria predictable funding to allow a meaningful, consistent and sustainable roads policy to be deployed. This requires additional investment of at least 400M BGN of net revenue Bulgaria ranks 102nd out of 148 countries in the quality per year. of its infrastructure, as per the 2013-14 World Economic Forum’s Global Competitiveness Report. This reflects This project’s journey started by Deliverable 0, which long term chronic underfunding in the national roads initiated analyses of numerous road network technology system as Bulgaria has extensive road maintenance and and coverage options. They ranged from distance-based upgrade needs, which hinder the required economic tolling for all vehicles to keeping the current model, growth. The Road Strategy of Bulgaria hence recognizes including various combinations of road network and the importance of maintenance, mobility, safety and technology solutions. Out of this initial analysis, following connectivity in accordance with EU directives to help consultations with the MRDPW and REA, several feasible sustainable transport for stronger European integration. procurement options were proposed that best meet policy goals, while being practical and financially viable. Currently, revenue from vignettes is insufficient The indicative results of different options are shown below for maintaining the road network, let alone future in terms of projected annual net revenue. The options that investments. The Road Strategy shows that Government could generate over BGN 400 million are shown in green. faces challenges to finance construction and required These results were then used to narrow down and further rehabilitation of all existing roads and bridges within 5 fine tune the options. Policy Options - Net Revenue (Mio. BGN) Minimum BGN 400 Mio. is needed for effective Road Infrastructure Financing E-tolling HGV + buses and Current E-tolling HGV + Baseline – Vignette Light buses and E-vignette Current Vehicles + Passenger Light Vehicles + All Vignette Cars Passenger Cars E-tolling vehicles DSRC GNSS DSRC GNSS DSRC GNSS motorway 218 non viable 252 non viable. 232 non viable motorway + 1st class roads 392 464 417 488 444 -421 200 motorway + 1st + 2nd class roads non viable 674 non viable. 703 non viable -81 motorway + 1st + 2nd + 3rd class roads non viable 773 non viable 806 non viable 110 These strategic options were assessed in Deliverable 1 • Part 3. An updated and extended financial and traffic and presented to the MRDPW and RIA for comments. model This work showed that satellite distance based e-tolling for heavy vehicles and e-vignette for light vehicles are the best options and could provide a tariff range and 2. The Vision for Bulgaria road coverage for bridging the revenue gap. Following It is essential that tolling in Bulgaria supports national and some additional consultations, this Deliverable 2 looks EU policy context. Government wants a unified, fair and in detail at e-vignettes for light vehicles and distance- high standard for revenue collection, guided by the state, based e-tolling for heavy vehicles, as summarized in this including control over financial flows and transparency of document and supported by three parts as follows: revenues. The proposed approach must: • Part 1. The institutional and operational models, legal • Allow “interoperability” in accordance with European law; changes and procurement work needed to deliver this new revenue, and support interoperability. This specifically • Allow flexibility to meet future needs and unimpeded looked at the option of a Special Purpose Entity set up for upgrade; Government tolling roles • Be user friendly to gain public acceptance; and • Part 2. A Master Implementation Plan, defining the tasks • Assist Bulgaria meet its security obligations and the fight and timelines, and against crime. 3 Executive Summary The approach must be flexible to future policy needs and designated sales outlets for travel on a particular route and growth in traffic, and support existing and new data needs specified time such as for Customs. And beyond raising revenue, there • Foreign heavy vehicles would buy route passes, buy or are future policy opportunities to remove reliance on fuel rent an on-board unit or, in the future, use EETS services duty as vehicles become more efficient, to implement that allow interoperability across Europe. smart management of roads and to charge by impact of emissions. • Bulgarian and foreign light vehicles will buy an Tolling technology has become easier to use. In-vehicle e-vignette, similar to the current approach but linked to equipment has become far cheaper, services are proven their number plate and stored electronically.. and give extra revenues for many EU Member States. E-tolling payments can be made using bank /debit cards New services are deploying every year and the evidence or bank accounts, or linked to other forms such as fuel base and market size is increasing. Many countries such cards. Users can use these methods on-line, by phone, or as Poland, Hungary, and Slovakia have successful heavy by post and e-vignettes can be bought using cash. RIA’s vehicle tolling that delivers high revenues. In addition to LIMA app offers possibilities for e-vignette purchase. Key tolling, mainstream consumer and vehicle technology benefits of this approach for Bulgaria are: now offers connectivity to vehicles and people, new ways to pay for roads services and further ways to reduce costs, • It has minimal risk of failure, by adopting solutions such as by using smartphones and apps. In the future, already proven elsewhere and tailoring them to Bulgaria, connected vehicles will emerge and allow new services rather than an unproven innovative risky solution. It can where tolling may be a backbone. be procured readily from many suppliers in the market Not all plans to introduce or expand tolling have with minimal risk. been successful. This is due, for example, to poor user • One Contractor would supply the technology and acceptance, lack of integration and poor stakeholder base services but other companies then provide added consultation. So Government has the opportunity to services, for example fleet management for vehicles with capitalise on lessons others have learnt and understand tolling combined. where challenges lie. • The capture of the key revenue from transit traffic can be by e-vignette, “route passes” or on-board units, and in The World Bank Recommended Model: the future by EETS interoperable units. Introduction of e-tolling only for heavy vehicles by Enforcement of the e-tolling system provides a good means of an on board unit registering data based on GNSS and e-vignette for light vehicles covering all opportunity to also deploy an e-vignette for light vehicles national road classes (motorways + class 1, 2 and 3 using the same system that checks number plates against roads). Achieving also interoperability within the scope payments and issues penalties to non-compliant users of the EETS Directive. and the same legal processes. The analysis showed that a Special Purpose Entity (SPE) is E-tolling and e-vignettes are the first layer of many best suited to implement all Government roles. Since the opportunities. They would also: procedure for the legal setting up of a SPE cannot start • Develop significant employment opportunities across prior to the mandatory launching of procurement for Bulgaria timely provision of revenues, it implies that RIA or some other existing state body shall manage the early stage of • Develop a centre of excellence in Bulgaria to exploit procurement and control of supply contracts. future technology developments and allow opportunities for Bulgarian companies to offer value added services, for example to help the Bulgarian freight fleet save money by 3. Collecting the Revenue in Practice adopting fleet management technology The overall vision is shown below. This shows: The vision diagram below shows for each type of user: • Bulgarian heavy vehicles would be electronically tolled • What they need to do to be compliant using either existing technology in their vehicles such • How and where they pay as fleet management systems or smartphones, or via new on-board units. Occasional users without on-board • The combined enforcement approach for both light and units could simply buy a “route pass” either on-line or at heavy vehicles 4 Executive Summary The Vision for Bulgaria 4. Institutional Model for Implementation But this option could only apply once tolling is Options operational, as the process of establishing the SPE legally and then getting it set up cannot be achieved To deliver these Government activities, such as receiving before procurement must start in order to deliver tolls, enforcement via issuing penalties and management on time revenue. This means that RIA or some other of the Contractor, we have examined several options. Of existing Government body will have to manage the early these, a single Special Purpose Entity (SPE) can best fulfil all procurement and contract supervision stage. Government roles, including enforcement, apart from road management and setting toll rates. These would remain There would be short-term challenges in setting up the responsibility of RIA and the Ministry of Regional such a company, so a rapid decision should be made Development and Public Works. The SPE option provides a by the Government with a commitment to timely “one stop shop” for tolling activity, brings enforcement and amend legislation, such as the Roads Act. If an SPE is not operations together seamlessly, and allows the ability to chosen, then an appropriate enforcement body will still recruit new expertise from the market. be needed. The Contractor cannot undertake the legal process of issuing penalties. The option of an SPE would be similar to the Austrian state tolling organization (the ASFiNAG Maut Service Co) and Such a SPE could be structured as shown below: NDS in Slovakia. Oversight Government Accountability Board Contract Revenue and Corporate Management management audits Liaison Enforcement services Delivery Contractor 5 Executive Summary 5. Procurement of the Contractor but instead on the maximum permitted weight of the vehicle, emissions class and whether the vehicle is towing Services would be provided by a single Contractor, a trailer or not. The Contractor will provide all the material appointed by government under the Public Procurement needed for the SPE to issue a penalty. Law. There would then be a variety of Service Providers from the market offering the ability for heavy vehicle users to pay Enforcement gantries will be installed to capture a digital tolls, either using equipment they provide or their own fleet image of a vehicle. These where possible will be based management devices (increasingly these are becoming on existing count sites, with added technology. Mobile based on smartphones and apps). enforcement units supplement gantries. Penalties for foreign vehicles are sent to the appropriate foreign The Contractor, acting on behalf of Government, invoices enforcement body. This approach requires on-line access Service Providers for the tolls incurred by their users. They to the vehicle registration database else the enforcement are not allowed to mark up those tolls – so there is no body will have to stop vehicles at the roadside, adding “wholesale” business but there should be a Dedicated cost and complexity. Other options are continued use of Service Provider to ensure there will be at least one available border checks required by law from Customs during the for users and to provide for any users who are unable to period before Bulgaria joins the Schengen area, and use of conclude a contract eg because of poor credit history. This debt recovery agents. will be procured as part of a single tender for the main Contractor, so the Contractor will be offering toll services in the retail market. Any SP business they undertake should 7. Programme have a completely separate balance sheet to provide auditable evidence that there is no cross-subsidy. The The programme has been developed in a Master Contractor would also provide Route Passes for occasional Implementation Plan shown overleaf for procurement and users. The Service would also be interoperable with the deployment, legal changes and ongoing support after European Electronic Toll Service (EETS) as this develops and deployment. would be deployed to support EETS Providers. The milestones in the plan enable the following achievements: Note that there is nothing in principle to stop services being provided as a “bolt on” to an existing national scheme, using • Award a contract for provision of the necessary systems the same back office hardware, software and potentially and services – March 2017 cloud services as another country. Note that this would • Commencement of e-toll collection for Heavy Vehicles – not necessarily improve interoperability, as EETS requires February 2018 contractual as well as technology links. • Commencement of e-vignette operations – July 2018. The contract requirements will constrain the Contractor Note that this is split from e-tolling to spread customer only where necessary, for example in language provision operations, communications and testing loads which is likely to mean a principal call centre in Bulgaria, in • Commencement of enforcement operations and IT / cyber security standards for where data is held and in contract monitoring by a Special Purpose Entity or other local enforcement technology and operational support. The enforcement body as required – February 2018 approach is to allow the Contractor to innovate to reduce costs and deliver a good service that is tailored to Bulgaria The main activities and products are: and meets local standards and legislation. The next Stage • Preparation of tender documents including will detail these requirements. requirements – planning this needs to start in December 2015 Similarly the Contractor and Service Providers may choose to use fleet management devices, which could include • Legal changes to enable e-tolling and e-vignette and smartphones and apps, depending on their approach and to establish the Special Purpose Entity (if required) – this the need to reduce costs. Government will not however needs to start in December 2015 too specify which types of device will be used – this will be left • Contractor implementation of systems to the market. The contract will require interface documents • Contractor delivery of operational services for the that support open yet secure access and payment and duration of the contract these can be also used to support smartphones. • Handover of enforcement facilities to the Special Purpose Entity or other body 6. Operations and Enforcement Note that these timescales are the same whether an SPE The Contractor will also provide the technology and or other body is set up, as the critical path is procurement equipment for enforcement, and could operate this at the and testing. If another body takes over enforcement tasks roadside. For ease of enforcement, tolling should not be instead of the SPE revenue would not accrue any more based on axles, suspension, or weight of vehicle plus trailer quickly. 6 Executive Summary Project Timelines 7 Executive Summary 8 Executive Summary 8. Finance Summary We have assessed in detail the combination of: • 3 scenarios of e- tolling charges (60%, 100% and 130%) of recommended rates as shown below in BGN/ • 2 scenarios of e-vignette charges (150 BGN or km. 97 BGN per year, with current day and monthly vignette charges retained); with These rates compare to other countries as shown below (red means higher than Bulgaria) for rates in April 2015: This shows that the recommended rates are lower These scenarios have been tested for road networks from than most other countries except Poland for heavy motorways plus class 1 roads, then adding class2 and vehicles and Romania for light vehicles. then class3 roads. This gives 18 different cost and benefit scenarios. The impact of reduced toll road traffic due to Different emissions classes for trucks have different different toll rates has been also assessed. rates. By maintaining this differential pricing between emission classes, the trend to “cleaner” trucks will The capital costs to collect these charges would range continue. Larger trucks of more than 12 tonnes will from 479M BGN to 745M BGN depending on road almost completely converge to cleaner emission classes coverage, with operational costs of 148M BGN to 253 M (EURO III – V+) within the next couple of years. BGN per year after that. But depending on the chosen At this point, a new emissions rate may be needed scenario, revenues per year could range from 661M BGN to maintain the trend. to 1,483 M BGN from 2018. So in all but a few cases, the system would break even in the first year. 9 Executive Summary However, the target for revenue still must be met, so approach shows the following options and sensitivities: looking at the average net revenue per annum over ten (Shown in green if net revenue is greater than 400M BGN years and allowing for the cost of finance by using an NPV per annum or red if less). E-toll for Trucks 60% Recommended E-toll for Trucks 130% of Recommended Rates of Recommended Rates Rates Option 1 for e- vignette (150 BGN per annum) for passenger cars Motorway plus 1st class roads 343 512 639 Adding second class roads 412 663 851 Adding third class roads 465 776 1001 Option 2 for e-vignette (97 BGN per annum) for passenger cars Motorway plus 1st class roads 266 435 562 Adding second class roads 336 586 774 Adding third class roads 389 700 932 This shows the trade-off between light and heavy charges, • Creating a Special Purpose Entity (SPE), should this and road coverage. The key is that the target cannot be approach be selected met unless: • A low e-vignette price is combined with recommended The Roads Act and Road Traffic Act and various ordinances, heavy vehicle rates, although not all the network needs to specifically Ordinance No-160, will need amendment. To be charged for heavy vehicles; or fulfil Member State obligations under the EETS Directive and Decision, not only must EETS Providers be accepted, • A high e-vignette price with lower heavy vehicle but also Government must set up a Register of EETS charges, but with additional roads charged for heavy Providers in Bulgaria and create a Register of Toll Domains vehicles. in Bulgaria. The Toll Domain register could for example Looking at average NPV over the ten years suggests the use the RIA GIS. Close liaison between Government, the low cost e-vignette plus low cost e-tolling option will Contractor and EETS Providers will be required to gain not meet this target. Hence either e-tolling or e-vignette collaboration. charges need to be around the recommended level but this means there is room for manoeuvre of rates if required. Adding class 2 and 3 roads gives additional net 10. Summary of Recommendations revenue, as does increasing rates, but does increase risks The recommendations in this report are: to delivery because of the geographic scope and poor public acceptance. • Government decision on the model recommended by Note that these predictions are based on the best data the World Bank. Introduction of e-tolling only for heavy available for the study on existing traffic flows and travel vehicles by means of an on board unit registering data patterns, and on current and expected costs of services. based on GNSS and e-vignette for light vehicles covering As new data becomes available, for example 2015 traffic all national road classes (motorways + class 1, 2 and 3 count data, the model should be updated to reflect roads). Achieving also interoperability within the scope of latest input data and to reduce the sensitivity of revenue the EETS Directive. RIA or another existing state body shall predictions to external factors and other changes over manage the early stage of procurement and control of time and due to market forces. supply contracts. • One Contractor should supply the technology and base services but other companies then provide added 9. Legal Changes Needed services, for example fleet management and tolling There is a need to address areas chosen to give the combined. minimum amount of legal changes required: • The capture of the key revenue from transit traffic can • Amendments to permit e-tolling and e-vignettes for be by “route passes” or on-board units, and in the future by Bulgaria EETS interoperable units. 10 Executive Summary • Enforcement of the e-tolling system provides an The Roads Act and Road Traffic Act and various opportunity to also deploy an e-vignette for light vehicles, ordinances, specifically Ordinance using the same system that checks number plates against No-160, will need amendment. payments and issues penalties to non-compliant users  variety of combinations of e-vignette and – A and the same legal processes. e-tolling rates can meet the revenue gap and • The SPE option provides a “one stop shop” for tolling, allow choices in network coverage and initial rates, brings enforcement (issuing penalties and receiving while still be under the EU average. monies) and operations together seamlessly, and allows the ability to recruit new expertise from the market. It would have its own financial model. But this 11. The next steps option could only apply once tolling is operational, as establishing the SPE cannot be achieved before Specific actions now quickly needed to be addressed to procurement must start to deliver on time revenue. ensure on time revenue are: • There would be short-term challenges in setting up • Quickly develop a communications plan with key an SPE, so a rapid decision should be made. If an SPE stakeholders for the project, especially road users and is not chosen, then an appropriate enforcement body hauliers, so that they can prepare for the changes and will still be needed. Note that the Contractor cannot be made aware of the benefits. This will be critical as undertake the legal process of issuing penalties, nor we move to procurement and is an area where other can it have the legal powers to stop vehicles (if this is countries have failed to deploy in time to prevent public required). unrest. • Services would be provided by a Contractor, appointed • Rapidly choose the body that will undertake by Government under the Public Procurement Law. enforcement (SPE or other). This needs to be done quickly The Contractor will also provide the technology and to avoid delaying the next stages of design. If a new body equipment for enforcement, and could operate this at is set up it can lead on all aspects of tolling operations the roadside for remote enforcement but not stop traffic. from enforcement to overseeing Contractor operations. It They could also provide a wide range of services to help will need its own financial model to be developed. the SPE issue penalties (eg printing and postage) • Start quickly to consider the changes to legislation • Tolling should not be based on axles, suspension or identified in this report to support various details of weight of vehicle plus trailer but instead on the maximum e-tolling and its procurement, and transposition into permitted weight of the vehicle, emissions class and Bulgarian Law of the EETS Directive. whether the vehicle is towing a trailer or not. • Look at the vehicle ownership and registration database  nforcement gantries will be where possible based – E and possibilities for access to improve joined up data use on existing count sites, with added technology. and reduce costs for better data sharing in Government. Mobile enforcement units supplement gantries. A decision on access to the registration database has a –T  his approach requires on-line access to the vehicle direct impact on who operates enforcement technology if registration database else the enforcement body roadside stops are then needed – a uniformed public body will have to stop vehicles at the roadside, adding cost or a private body – and on foreign vehicle enforcement. and complexity • Rapidly prepare contract documents based on the • Penalties for foreign vehicles will be sent to the institutional and operating model and decide who will appropriate foreign enforcement body, debt collector undertake the procurement. or collected at Customs checks. • Engage with Bulgarian industry, especially fleet • There is a need to amend legislation to permit e-tolling management providers and local companies able to and e-vignettes and to support creating an SPE, should be Service Providers, and engage with the international this approach be selected. tolling industry, to prepare them for the tender. PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability 12 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Summary will also provide services for collection of e-tolling charges and on board units to consumers that have not signed This Deliverable 2 provides a detailed review for a contract with a Service Provider, and rout passes for implementation of e-vignettes for light vehicles and occasional consumers without an on board unit. In the distance based e-tolling for heavy vehicles in Bulgaria. It process of its development this service will be operable comprises three parts: with the European Electronic Toll Service (EETS). • Part 1 (this document) looks into institutional and Light vehicle users will be able to purchase e-vignettes operational models, legal amendments, procurement from the Contractor, via a web site, call center and issues and European interoperability. smartphone applications (including eventually the traffic • Part 2 – Implementation Master plan discussing project application LIMA) by using multiple components for management and time schedule e-tolling collection and vehicles registration of the system applied for heavy vehicles. Additional canals for sale of • Part 3 – updated financial model rout passes and e-vignettes will be available to Customs In addition, this notice has been prepared in summary of and border crossing points. the above stated. The Contractor shall also provide the technology for First of all this document looks into the institutional model performance monitoring and shall operate it on the road. of the e-tolling system. It is based on the model described In view of facilitating performance control, the amount of in the European decision of 2009/750/EC (EETS decision) tolling shall not be calculated on the basis of number of which determines the specific responsibilities that may be axles, suspension type or combined weight of vehicle and implemented only by the Government. trailer, but on the basis of the maximum admitted weight, vehicle emission class and whether the vehicle is pulled by Several options for implementation of these Government a trailer or not. responsibilities have been discussed, as for example receipt of distance based toll charges, monitoring the Gantries to support implementation control shall be Contractor’s quality assurance and management. Setting installed on toll roads, where possible and at currently up of a single Special purpose entity (SPE) has been existing objects recording digital images of passing proposed as the most suitable option for taking over vehicles. In case of no violation, the image shall be the Government functions, including issuing penalties deleted, but if a violation has occurred, the ticket shall for enforcement, but excluding road management be sent to the vehicle owner. Fines for violations by and setting the size of road charges which are to vehicles registered abroad shall be sent to the relevant remain within the authority of RIA and the Ministry of enforcement body abroad. The operation of automated Regional Development and Public Works. That option enforcement gantries installed on the roadside is also provides a ‘one stop shop’ for e-tolling services, merges supported by Mobile Enforcement Units. That approach enforcement of penalties and appeals with operational requires online access to the database of registered activities, and is conducive to acquisition of new know- vehicles in the country and abroad to secure enforcement how from the private sector. This model can only be of sanctions, or at least off line access to check the applied after the distance-based e-tolling system is registration of vehicles and owners upon opening an already in place, since the establishment of SPEs from account for service provision. If such access is not available a legal perspective shall not precede procurement and the enforcement body shall stop vehicles on the road, but due revenue collection from e-tolling. That means that this will complicate its work and will result in additional RIA or another state body, shall continue to manage and costs. monitor the relevant procurement processes and the The cameras are used only to capture evidence for contracts signed as a result. penalties, and not for toll collection. They do not need to E-tolling collection services shall be provided by a have complete image capture but should be specified Contractor assigned by the state following the provisions and installed to minimize the need for manual checking of of the PPA, since that is the most appropriate means images. of contracting among the options discussed in this To permit distance based e-tolling and e-vignettes there is document. Moreover, it allows a number of private Service a need to amend legislation in the following fields: Providers to provide distance-based e-tolling payment • Amendments allowing for regulation of distance based opportunities to heavy vehicle users or equipment using e-tolling and e-vignettes in Bulgaria; either equipment supplied by the Service Providers, or their own units for car-fleet management (increasingly • Establishing of a Special Purpose Entity (SPE), should that these applications as smartphone based). The Contractor approach be selected. 13 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Amendments are needed to the Roads Act and the elements and public procurement, including transposition Road Traffic Act, including a number of bye-laws, such as of EETS Directive in the Bulgarian legislation. Ordinance No 160 of July 7, 2008. • Consider to expand the possibilities for access to the To meet its obligation as a member state under EETS registered vehicles ownership database to improve joined Directive and Decision, the state shall not only permit up data use and reduce costs for better data sharing activities of EETS Providers, but shall also: in Government. A decision on access to the vehicle registration database will have a direct impact on who • Create a register of EETS Providers in Bulgaria and operates enforcement – a state body or a private body, establish relevant conciliation bodies; and on the body for enforcement abroad. • Create a register of Toll Domains in Bulgaria (initially • Prepare contract documents based on the institutional there will be only one Toll Domain). This could use the and operational model, and determine the body existing RIA GIS. responsible for procurement. • Develop a communications plan with key stakeholders The following specific actions shall be considered: for the project, especially road users and hauliers, so that • Determine the enforcement body (SPE or other). That they can prepare for the forthcoming changes. shall be done as soon as possible to avoid delays in the • Engage in dialogue with the Bulgarian industry and next phases of design. Should a new body be established, ITS stakeholders, especially fleet management system it may manage any aspect of e-tolling operations, from providers, ITS Bulgaria and local companies able to enforcement to monitoring Contractor’s performance. be Service Providers, including cooperation with the • Consider the legislative amendments listed in this report international tolling industry, to prepare them for the to support the functioning of the various e-tolling system respective tenders. 14 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability 1. Introduction A Background opportunity to remove reliance on fuel duty which will inevitably reduce as vehicles become more efficient, to This is the first part of the third deliverable (Deliverable implement smart management of road use by charging 2, following Deliverables 0 and 1) in the “Development different rates at different times to reduce congestion and of a Comprehensive Vision for the Introduction of the to charge by impact on road maintenance and emissions. Electronic System for Provision of the European Electronic Toll Services in Bulgaria”. Bulgaria has critical road Tolling technology has become easier to use, in-vehicle maintenance and upgrade needs that require substantial equipment become far cheaper and services proven in investment. This investment will help achieve economic use and successfully generated extra revenues for many growth and improve traffic management, road safety, countries, especially for trucks. New systems and services national connectivity, trade facilitation, and security. are deploying every year and the evidence base and The current revenue from sources such as vignettes and market size is increasing. Many Eastern European countries central funding does not cover the growing whole life now have heavy vehicle tolling in place and some are costs of the Republican road network. So a long term looking at all-vehicle solutions in the future. As well as sustainable solution is required to collect revenue through tolling, mainstream consumer and vehicle technology smarter approaches to tolling than the current sticker now coming on stream offers increased connectivity to vehicles and people, new ways to pay for services and vignette system can allow. further ways to reduce costs. Future tolling needs to be a smart policy “tool” to more Not all plans to introduce or expand tolling have been fairly distribute costs amongst road users, rather than successful in other countries, due to, for example, poor “one price for all” as now. Technology offers new options user acceptance, lack of integration and poor stakeholder to achieve this aim, to collect revenue at different rates consultation. Bulgaria has the opportunity to capitalise from different types of vehicles and on different roads, and on lessons others have learnt on what makes a successful to adopt the user/ polluter pays principle so that those deployment and where the challenges lie. So the overall vehicles that damage the roads most pay more. Such a need for a project is clear and the time is right to consider policy approach would allow queue-free, integrated, and Bulgaria’s specific needs and current investment. unified collection of tolls for the State. Although optimal collection of net revenue is vital, other needs also apply. A key need is to be interoperable with B Objectives of the Project the rest of the EU in line with Directive 2004/52/EC on the Overall Objectives interoperability of road tolling. Any future approach also needs to be flexible to future policy needs and growth The objectives of the project in this Stage I Module 2 in users and uses, and support new services and existing are to develop a strategy and business model based on government data needs such as Customs. Above all, the deliverable 1. approach must be easy to use and achieve high levels of Stage II will then in the future support selection of a user compliance. supplier by preparing contract documents. Bulgaria is one of the crossroads of Europe – with many Trans European corridors passing through it. This means C The Scope of this Deliverable a need to collect revenues from visiting and transiting vehicles, to maintain road quality and to support smooth Structure border and internal security operations. The current This document is one of three parts of deliverable 2: vignette system collects revenue from foreign vehicles and there are opportunities here for smarter approaches • This document, dealing with institutional, technology, to ensure visiting vehicles pay their fair share. The legal and procurement aspects as well as interoperability, current sticker vignette system is costly to administer is part 1 and may not collect all the revenues due – as it is not • A Master Implementation Plan in part 2 , which will need an easily enforceable system. It is also a very blunt tool to be updated regularly – charging by duration of access rather than distance. • A separate report on traffic and revenues in part 3 New approaches to smarter, more effective collection than the vignette could improve revenue in a fair way. There is also an Executive Note covering all the areas for a Beyond raising revenue, there is a potential future policy non-technical reader. 15 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability This report contains the next level of detail down from • Chapter 4 looks at legal and procurement issues deliverable 1 but is not yet a full specification for the • Chapter 5 looks at interoperability procurement. • Chapter 6 contains the next steps D The Structure of this Part 1 Appendices give supporting detail including the analysis Structure of feasible options as presented in Deliverable 1. This deliverable follows the Terms of Reference and has chapters structured as follows: E Meeting Requirements • Chapter 2 looks at the institutional model of who Mapping to the ToR undertakes which activity The following table shows for each Term of Reference • Chapter 3 looks at technology and interfaces to support requirement which section in this deliverable contains the how activities are delivered required information. Term of Contents Covered in which Part Reference Section 2.1 Identification of national routes or road sections for which it will Traffic and revenue report apply. (Part 3) 2.2 Development of a draft master plan for the development of an Master Implementation Plan Electronic System for the provision of EETS. (Part 2) 2.3 Monitoring and control of the development and Master Implementation Plan implementation, and possible adjustments to the master plan. (Part 2) 2.4 Defining an institutional model / model for collaboration Chapter 2 of this report between public and private partners 2.5 Developing a model for collaboration in the operation of the Chapter 3 of this report electronic system for provision of EETS (tasks, responsibilities, workflows, interfaces, etc.). 2.6 Development of a legal model for the development Chapter 4 of this report and implementation of the system, including legal and organizational structure, contractual relationship with the system provider and the relationship of the provider with concerned agencies and institutions. 2.7 Development of a preliminary financial model (flows of Traffic and revenue report investment / costs / revenues, distribution of assets and (Part 3) liabilities, rules and frameworks for payment, etc.) 2.8 An estimate of revenues from the toll collection by classes of Traffic and revenue report network and categories of vehicles for a period of 5-10 years (Part 3) 2.9 Development of preliminary financial plan for a forecasted Traffic and revenue report / anticipated period of return on investment in terms of (Part 3) developing the electronic system for the provision of EETS 2.10 Development of a plan to ensure interoperability with other Chapter 5 of this report Member States having a system of electronic toll collection, within three years for vehicles over 3.5 tons and five years for all other vehicles after the decision on the introduction of EETS in accordance with Directive 2004/52 / EC on interoperability of electronic road toll systems in the Community. 16 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability 2 The Institutional Model A Overview  ays to the Toll Charger any fines/ penalties received – P for non-compliance Objective Note that Route Passes are available for those who do not This section addresses the terms of reference requirement have an on-board unit. There will then be a “Contractor” to provide the technology and services that underpin the Defining an institutional model / model for government roles. collaboration between public and private partners. In Bulgaria, a single body separate from RIA and from the The model proposed for Bulgaria is based around Ministry of Regional Development and Public Works could the Service Provider (SP) and Toll Charger (TC) model fulfil all the Government functions of the Toll Charger described in Deliverable 1. This model allows roles to map except: to European Directives and also align with solutions in the market already. In summary, in this model for heavy • The operation of roads. It is assumed that RIA will retain vehicles: responsibility for the construction, maintenance, and operation of roads. • The “Toll Charger”, typically Government or a group of government bodies: • The setting of toll rates, including the definition of toll liable vehicle classes, the definition of road classes Operates the toll road –  and individual roads liable to toll, the toll rates for those Charges for the use of the toll road –  vehicles and roads as well as discounts and exemptions. It –  Sets the toll rates is assumed that these will remain the responsibility of the Ministry of Regional Development and Public Works. Any  erforms enforcement activities, including issuing – P use of discounts, eg to encourage early registration should penalties and setting rates for penalties (eg no OBU, be considered at the next Stage. faulty OBU, mis- declared class) and receiving fines – C  ommunicates with users about toll roads, rates and Such a single body could also go further than just the enforcement above roles, by acting as a single “one stop shop” for tolling that users would recognise, and be the hub for  eals with enquiries from users related to any – D communications with users and stakeholders including penalties issued media during operations. It would link the day to day  ndertakes legal responsibilities to support – U management of the project and the Contractor with interoperable services under the European Electronic issuing penalties for enforcement of non-compliance, Toll System (EETS) Directive. an area where close liaison is essential, and it could also • The Service Provider (or Service Providers) provide the core for interoperability tasks needed to support EETS.  nsures users have appropriate on-board equipment – E so tolls are correctly charged  ills users for tolls , collects money from users and – B B Potential for a “Special Purpose Entity” In passes it to the Toll Charger Bulgaria for Tolling  eals with queries about on-board equipment and – D about bills for tolls Options for the Government role of Toll Charger – R  eceives payment from Government for carrying out The role of Toll Charger shown above requires a definable this service organization which is responsible for toll revenue and – M  ay also charge the user for provision of the service particularly enforcement. There are several typical ways in and for additional services which this organization can be delivered, including as: • The User • A single department within an existing governmental –  Interacts only with the Service Provider in normal organization operations • Separate departments (e.g. tolling and enforcement) –  Installs or has already installed on-board equipment within governmental organizations to locate the vehicle • A single entity at arm’s length from existing –  Receives from the Service Provider bills for tolls and governmental organizations, having a remit of focusing settles those bills on tolling and enforcement – a so-called “Special 17 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Purpose Entity (SPE)”. This could undertake all of the to plan expenditure over long term and with less risk to Toll Charger functions identified above except roads programs due to political cycles. operation and charge setting, and be a focus for For example in Austria, ASFiNAG Maut GmbH is a 100% communications with users and awareness of benefits. government owned company which has responsibility Hence it would be a “one stop shop” for the Government for the operation of the e tolling, and vignette systems. side of tolling. The company responsible for construction, operation, A key Government function is that of enforcement and maintenance of motorways and national roads is (specifically issuing penalties but also possibly roadside fully funded from toll and vignette revenues collected by operations) and, as shown in the Master Implementation ASFiNAG. Plan, having a suitable enforcement body in place and training and building capacity in its team drives the Similarly in Slovakia, NDS (National Motorway Company), availability of revenue. For example the SPE staff a joint stock company 100% owned by the state, is will need to know how the system works, how penalties responsible for operation and maintenance of motorways are issued, understand and help define the business and national roads and collects income from a vignette for rules and develop for example appeals processes. light vehicles and e-tolling for heavy vehicles It is assumed that the Toll Charger role, including issuing In Hungary, the government established a company penalties and collecting fines, will be carried out by a (National Toll Payment Service PLC) with specific and state owned and operated entity (or entities) we separate responsibility only for the operation of ETC and shall from this point on simply call “Government”. Vignette systems. Government will be responsible for procuring the In Poland, the Czech Republic, and Germany, government necessary contracts to design, build, install, maintain, appointed an operating contractor directly rather than and operate the system and enforcing it, as well as through a special purpose company, although in Germany stakeholder communications. The key question is the the government is a partner in the operator. In Poland, form that the “Government” body could take from the enforcement is by a separate government organization. above options? In Spain, Italy, and France Toll Chargers are private Hence this section briefly describes firstly how this role is companies. delivered in other European countries; it then describes the strengths, weaknesses, opportunities and threats (SWOT analysis) of an SPE and addresses the issues to be SPE Options for Bulgaria resolved in setting up an SPE. An SPE would be responsible for all aspects of tolling as a separate entity, but under the oversight and ultimate Other European Practices control of the Government. It would have executive powers and day-to-day delivery responsibility against In Europe, the role of Toll Charger is either carried out by a strategic outcomes (eg net toll revenue). private motorway company or by a government agency or private operator appointed by government. One model is It would be similar in many ways to the existing body a state-owned company used in several EU member states (National Company Strategic Infrastructure Projects) set up for heavy vehicle electronic tolling. An organization such to deliver motorways in Bulgaria. Such a company would as this can have greater budgetary ‘ownership’ and ability be structured as shown in Figure 1: 18 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Figure 1. Proposed SPE Organization Structure Oversight Government Accountability Board Contract Revenue and Corporate Management management audits Liaison Enforcement services Delivery Contractor In this proposed model: sharing, roadside operations, vehicles of special interest • Government would be the only shareholder, and have oversight over all outcomes (as any company is  nforcement – i.e. managing day to day enforcement – E responsible to its shareholders) operations, issuing penalties and collecting fines and downstream activity such as appeals. The appeals • A Company Board would be accountable for the funds process needs to be determined at the next Stage allocated by Government used to initially collect toll but typically would involve the offender presenting revenues (and ultimately use some of those revenues to evidence that either the toll had been paid or the fund itself ), passing the majority back to Government. This vehicle was not using the road. If this is rejected an Bboard would be similar to any company , with a chair, a outside appeals body may be required. Note that the CEO and a CFO SPE’s key role is in issuing penalties, but it can use the • It would have its own finance system and processes, to Contractor to provide services to support this role (eg be defined in the next Stage, for collecting tolls into its printing, postage, finance…) bank via the Contractor and dealing with revenue form  orporate services, for example taking the role of – C penalties Toll Charger as defined in the EETS legislation to • The SPE would provide or delegate the following define and set charges, approve contracts and other activities: activities only a semi Government organisation can undertake Management of the Contractor and supply chain –  plus other Service Providers, who will provide many The Contractor would provide activities such as customer services, toll collection, account management, equipment of the services and infrastructure installation and maintenance, OBU supplies, etc., as A revenue/ audit department, checking that the –  detailed in later sections. revenue collected by the Contractor is correct and The Board would have high level Key Performance reporting upwards on the tolls collected to the Board Indicator (KPI) targets to meet, notably on revenue and Government. The roles of the SPE with regard to collection accuracy and service quality. They will pass finance need to be defined in the early stages these down to their teams and to the Contractor to A liaison team, to work with RIA, Customs, the police –  deliver against with penalties if they are missed. Like any and other agencies and allocate responsibilities company, non-delivery of the targets could mean loss of and resources where need be for example for data position for Board members. 19 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability The advantages of this SPE would be: • Acting as a focus for new services and innovation such as connected vehicles • It would be a single center of expertise in a new discipline, (e-tolling) with single points of contact for • Being an umbrella for data sharing in the roads sector the Contractor and Government, rather than a patchwork • Above all, being positioned at arm’s length from of organisations responsible for various aspects government, being seen to collect tolls for reinvestment (e.g. enforcement, revenue, interoperability) in roads rather than “just another government tax • It would be a single center of expertise in a new collector” discipline, (e-tolling) with single points of contact for the Contractor and Government, rather than a patchwork Potential disadvantages of setting up a new SPE are: of organisations responsible for various aspects • It would take time to set up the organisation and find (e.g. enforcement, revenue, interoperability) suitable talent, so a decision to proceed should be made • It would focus on the delivery of revenue as tolling quickly. Even then it is unlikely as shown in the Master would be its core business and so resources would be Implementation Plan that the SPE can be in place in time “ring fenced”, and not spread across many functions to let the procurement. The SPE would therefore be an operational body, not a procurement one. • The mix of private sector ethos and talent, yet working for Government as the ultimate controlling body, means • There is a large volume of supporting experience in incentives can be made for on time delivery and market many current organisations such as RIA and Customs, salaries can be paid for specialist skills. Equally, non- so careful access to resources is needed to ensure this is performance is easier to punish. not lost. • It could identify and allocate resources from the toll • Memoranda of Understanding with supporting partners, revenue stream, so avoiding issues of bodies being e.g. Police and Customs, will be needed to define a clear given responsibilities without additional resources from interface with the new body and responsibilities. Government. It can choose how best to pay to undertake • Setting up the organization will require more funds various operations not able to be done by the Contractor before toll revenues flow than a conventional body, but • Having a single company able to procure and manage would reduce costs longer term. services from the market will give confidence to the market that Bulgaria is a new key player in tolling, and The table below summarizes the strengths, weaknesses, also shows commitment to the EC to interoperability. opportunities, and threats from the use of an SPE The Toll Charger role is vital to opening up interoperable (government owned) as the “Government” side for tolling systems operations. • Still having accountability to government for delivery of revenue, but leaving the day to day decision making to those best placed to make decisions • The ability to plan and programme budgets independently from Government funding and decision making cycles – so not having to worry about stop/ start funding • A single “brand” for tolling, so that customers know who operates the service and who is responsible, with a single champion for tolling in Bulgaria – the CEO • The opportunity to attract new talent in a new structure, especially in areas not part of Government core business, such as tolling, enforcement and customer services • The ability to mix and match the wide variety of skills and experience from existing bodies and new talent needed to deliver a complex multi- disciplinary service like tolling 20 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Table 1. SWOT Analysis Summary Strengths Weaknesses • O  ne single body is accountable for tolling in Bulgaria •  Time will be needed to set up the body, recruit staff with an individual champion, instead of a patchwork and train them (although to some extent this will of organizations apply to any government organization). •  A focus on delivery of revenue •  Lack of knowledge of road network / traffic operations •  Able to incentivize delivery unless good links with RIA are established •  Manages its own resources from the toll revenue •  Knowledge and expertise residing in other organiza- stream tions (if not involved) may be lost or difficult to access. •  Gives confidence to the market and shows commit- •  Additional funding may be required to establish ment to EETS the new SPE prior to toll revenue being collected (new buildings, staff, etc.). However new staff will be •  ‘Arm’s length’ body may be less dependent on political required for any Government enforcement activity cycles / timescales anyway •  Ability to recruit expert and specialist tolling staff at •  The legal review (Section 4) suggests that an SPE re- private rather than public pay rates quires more legislative change than using an existing •  Possible greater budgetary ‘ownership’ to plan expen- Government body diture over long term •  Integration of toll collection and enforcement func- tions •  Resources would be dedicated to functions asso- ciated with delivering toll revenue collection and enforcement •  Possibility to create a recognizable brand identifiable to users and other stakeholders as one place being responsible for toll operations •  Public procurement rules still apply for transparency •  Fewer operational interfaces day to day between bodies •  User perception is that tolls are more linked to roads costs than a general tax from Government Opportunities Threats / Risks •  Possibility to clearly delegate operational policy to the • A  s legislation is required to establish new SPE this may organization best able to make day to day decisions result in extended delays to revenues* •  Possibility to provide a more flexible operation / •  Timescales required to set up SPE (after any required service to users in order to respond to operational legislation) may be incompatible with procurement challenges timescale •  Possibility to extend to other toll roads, tunnels, river •  May be perceived as a bureaucratic body if not react- crossings etc ing to road users’ needs •  Acting as a focus for new innovations •  Could create unregulated bureaucracy of its own •  An umbrella for data sharing •  VAT position with respect to toll collection would need to be confirmed •  If SPE cannot be set up in time for procurement start, another body would have to start operating the sys- tem and then hand over to the SPE 21 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability The Master Implementation Plan in Part 2 examines • It is assumed that the tolls would be used to fund road the timing of legislation and setting up an SPE and construction and maintenance. Therefore funding would shows that the flow of revenue is not dependent on need to be defined – i.e. would the SPE have a fixed the choice of an SPE or otherwise, as legislation and annual budget, or a percentage of tolls, and would any setting up enforcement processes for penalties, appeals, incentives / penalties be applied for its performance? From etc and training and building capacity in its staff is the a legal perspective, the financing of the SPE could come critical path. This is key – a new enforcement body from: needs to be set up anyway be it part of the SPE or not.  he national budget on the basis of a contract with –T the Government, Note that the SPE or another body is required once tolling commences for enforcement specifically issuing – From toll revenues penalties. It does not need to be in place at the time • The SPE may need to borrow to fund its own set up that the contract is let to the Contractor. The Master costs as well as the set up costs of the toll collection Implementation Plan identifies that the process of system, plus later renewal costs establishing the SPE legally and then getting it staffed and set up as an operational company finishes in August 2017. • Can such a body be given the powers to issue and enforce penalties and if required to stop vehicles? In order for the system to go live in early 2018, It is understood that as a government body, albeit arm’s the procurement process must start during 2016. length, this is possible but this is a critical element to Therefore the SPE cannot start the procurement (since verify. it will not yet exist) and it can only be involved in the contract supervision from about halfway through • Do public sector pay scales apply? It is assumed that this the implementation period. So this means that RIA or is not the case, since part of the aim of an SPE is to give it some other body than the SPE will have to manage the operational flexibility. procurement stage and implementation supervision • How does it interact with RIA in terms of implementing / stage. There is then a handover risk, but this should be maintaining roadside tolling infrastructure? Procedures manageable. would need to be defined e.g. engineering standards, Setting up an SPE approvals, resources, access to roadside electrical power supplies etc. The following details need to be addressed in SPE implementation: Impact on Operational Model • The precise responsibilities need to be defined; it is assumed that the scope will be all Toll Charger activities The diagrams below show the overall context model for except setting of tolls and managing roads. tolling with and without an SPE. 22 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Figure 2. Context Model with an SPE Figure 3. Context Model without an SPE 23 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability The key differences are: The Contractor, acting on behalf of Government, invoices Service Providers for the tolls incurred by their users. SPs • The SPE becomes the enforcement body, and without (in line with the EETS Directive) are not allowed to mark an SPE this is not yet assigned up those tolls – so there is no “wholesale”. The Dedicated • The SPE provides a clear link to auditing Service Provider will be procured as part of a single tender for the main Contractor, so the Contractor will be • The SPE provides clear management of both offering services in the retail market. They should have a government functions and the of ETC System / Service completely separate balance sheet to provide auditable Contract evidence that there is no cross-subsidy Conclusion An on-board unit has traditionally been a dedicated The above analysis shows that the SPE model has few real device for tolling, with high performance but also high weaknesses but many strengths, and we have assessed cost. Market trends are now to supplement or even the risks as manageable. Hence it is recommended that an replace such equipment with fleet management units, or SPE approach be considered for tolling operations, with an hybrids of smartphones with tolling equipment. Vehicles existing body starting the procurement. Whatever option are becoming more and more connected and will soon is chosen an enforcement body must be set up. provide the location data needed for tolling themselves as line fit equipment. This is a fast moving area – new products were announced in October 2015 that reduce C Toll Collection Operations costs and complexity by using more of the capabilities of a smartphone. It should be left to the Service Providers and Overview the Contractor to determine the best value and easiest-to- Whatever body is determined by Government will appoint use solutions. a Contractor to develop the systems and services. As For occasional users, the cost of even a simple on-board defined in deliverable 1, e-tolling will be based around unit / smartphone may be disproportionate. Other GNSS on-board equipment mounted in toll liable vehicles users may not wish to have a contract with a Service to provide data and these data will be provided by a Provider. For these users, the option of a “route pass” will combination of other bodies: be available. This allows a user to drive once from A to B • National Service Providers (NSPs). These are within a specified time window. The charge is based on independent companies who provide e-tolling services to the vehicle’s class and the distance between A and B and users in Bulgaria, collecting location data and dealing with is therefore compatible with the “Euro-vignette” Directive users’ invoices and payments. They may be for example (see Section 4.3 of Deliverable 1). The most likely users fuel card providers. would be foreign vehicles occasionally transiting Bulgaria. Purchases would be carried out electronically, with the • EETS Providers (EPs). These provide services to users in user providing vehicle details (registration, vehicle class), Bulgaria and in other EU countries, using a single on-board route, and date planned either on-line or at kiosks. The unit and account for all countries. There are at least 12 system would calculate the toll due, which the user would EETS Providers setting up across Europe. pay in advance. On payment, the route pass would be • Toll Declaration Data Providers (TPs). These only recorded in the central system. provide location data and not payment methods. They will An e-vignette for light vehicles is very similar. The typically be fleet management companies. difference is that the charge made is not per kilometre The location data they all collect are passed to the and the user is not limited to a route between two points. Contractor, who then calculates the toll due. Claims for Since users do not require accounts or on-board units and tolls are then passed to the NSPs or EPs for payment and the details of the purchase must be recorded immediately collection in turn from users. Tolls incurred by users of TPs in the database, there is little advantage in using NSPs for are collected directly from those users by the Contactor. the sale of e-vignettes and route passes. These services should be provided just by the Contractor. Route passes The detailed responsibilities of these bodies are set out later. and e-vignettes can be purchased via a website or at toll Note that in addition to market driven NSPs, there should be terminals located conveniently at service stations, border a dedicated NSP operated by the Contractor also. This will points, etc. The Contractor may choose to sub-contract ensure that when the system starts operation there will be aspects of this, for example to Customs. at least one NSP available and to provide for any users who are unable to conclude a contract with an independent NSP, The alternatives that exist for the user to pay tolls are for example because of poor credit history. illustrated below. 24 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Figure 4. Options for Payment Government Operating Contractor National Service Toll Declaration Dedicated Route Passes via Route Passes via EETS Providers National Service Providers Data Providers Website Toll Terminals Provider In the diagram above, the blue boxes indicate ways to others may be more technical requirements defined by pay provided by the Contractor. Other coloured boxes the Contractor. are carried out by other organisations. The e-vignette is The Contractor will be responsible for producing the not shown but would be bought on-line or through a call Toll Domain Statement on behalf of Government. Some center, post office or smartphone app. The RIA LIMA app is of the data required, such as road data, may come from an ideal route for e-vignette registration. Government. However, the Contractor should be required to produce GIS data for the precise identification of roads The Contractor (possibly based on the existing RIA GIS). This will be The responsibilities of the Contractor include: defined at high level by government and then be added to, to include precise entry and exit points for example) Preparation of the Toll Domain Statement and will be required to define how the NSPs, EPs, and TPs are to provide location data. This may include options for This formal statement describes matters such as: full passage of a segment or partial passage, to be defined • The extent of tolling (road network, bridges, tunnels, in the next Stage. ferries) Suitability for Use Testing • Publishing toll liable vehicle classes and rates applicable and exemptions. Exemptions from vignettes are already So that tolls are correctly charged and collected (and defined in Bulgarian law (see deliverable 1 annex 4) and that users are correctly penalised for non-compliance), there are very few vehicles that are exempt (Ministry of it is critical that the location data provided are accurate, Interior, Ambulance, Army, agricultural tractors, disabled complete and timely. When a Service Provider wishes to persons). Using this strict and narrow legal definition it is establish a contract with Government, the Contractor unlikely that significant leaks of revenue will be seen as will carry out tests to check that the on-board units and has been observed in other countries where exemption systems provided and used by the NSP, EP, or TP are definitions are less stringent. Exempt vehicles will be suitable for use in Bulgaria. identified by their number plate from either a special register of exempt users or direct from the registration Toll Calculation database. The Contractor will receive data from NSPs, EPs, and TPs • Contractual terms and conditions for contracts between based on the location data produced by on-board units. Government and potential NSPs, EPs and TPs. These On the basis of this, the Contractor will be responsible for calculating the correct toll due. The location data received cover financial matters, Key Performance Indicators, and can in general be presented in one of two forms: validating that the on-board units of NSPs, EPs, and TPs function correctly. Some of these terms and conditions • Raw GNSS location data (this vehicle was at these may be set by Government including cyber security, coordinates at this time) 25 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability • Toll object identification data (this vehicle was detected • Users do not have to install a separate on-board unit, on this toll object – road segment, bridge, tunnel – at this reducing complexity time) • Re-use of existing on-board equipment lowers the It is the responsibility of the Contractor to define how he overall costs of the system requires location data to be received. This forms part of the • It may be possible to start the e-tolling system operation Toll Domain Statement above. more quickly The location data received from the NSP, EP, or TP will also • Since the existing on-board equipment has been include the on-board unit identifier and vehicle class data installed for business reasons important to the fleet related to that on-board unit. owning company, it is less likely that it will be switched off to avoid paying tolls. Compliance rates may therefore be Toll Collection from NSPs and EPs increased The Contractor issues claims to each NSP / EP for the tolls incurred by their users. The frequency of these claims Where the operators / suppliers of the on-board and the time lag between tolls being calculated and the equipment are also equipped to bill their users for tolls claim being made is defined in the contract between incurred and to collect tolls, they may choose to become Government and the NSP/EP. full National Service Providers. However, in most cases they would simply act as a Toll Data Provider (TP) and send Generally, a single claim for payment will be made, positional data (“Toll Declaration Data”) to the Contractor, covering all tolls incurred by all users. To support this, the in the same way as an NSP / EP does. Contractor also provides to the NSP / EP, full details of tolls incurred, specifying each individual road segment Unlike an NSP / EP, the TP would not be responsible for on which a toll has been incurred. How often and how billing the user. Instead, the user would set up an account quickly these supporting data are passed is also defined with the Contractor who would then bill the user directly in the contract. The supporting data and the claim for and collect the tolls. payment do not necessarily have to be passed together. The potential disadvantages of using Toll Data Providers How quickly the payment claim is made is driven by are: the financial requirements of the Government, and how quickly the supporting data are provided is driven by how • Adding a new type of entity to the institutional / quickly the NSP / EP wishes to track the liabilities being operational model adds complexity and hence risk and incurred by his users. cost Note that the Contractor does not issue claims to TPs • Although this model is not new, having been for tolls incurred by the users of that TP. This is discussed implemented notably in Hungary, it has not been separately below. standardised in the same way that the “pure” Service Provider model has been. Therefore there may be more The Contractor is responsible for tracking the collection of difficulties in implementing this model payments of toll claims by the NSP / EP. Whether these are made direct to the bank account of Government or of the • There may be many Toll Declaration Data Providers. For Contractor (who then transfers the funds to Government) example, in Hungary there are 22 such entities with 50 depends on whether the Contractor is liable for the actual different on-board unit types. Such numbers would add collection of toll claims. In the latter case, the payments a significant burden of contract management / on-board would be made to the Contractor’s bank account, who in unit verification for the Government and its Contractor. turn would pay Government. Although this would reduce However, overall the advantages of a low cost, low time the risk of toll collection to Government, it would impose to deployment solution with flexibility for the market to a corresponding risk on the Contractor, which would be innovate outweigh the risk of addition of TPs. NSPs can reflected in the price charged. still provide all the services if no TPs emerge, but given the interest shown already by Bulgarian fleet management Toll Collection from Users of TPs companies this is currently unlikely. Many vehicles already have GNSS-based equipment Sales of route passes and e-vignettes installed for fleet management, insurance, or track- and-trace services, which can also potentially be used A route pass or an e-vignette is simply an entry in a for e-tolling. The rise of smartphones and connected database that a user has the right to use a road or roads vehicles will add more options. There are significant at a certain time. The Contractor will be responsible advantages to this: for establishing the appropriate sales channels – 26 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability e.g., website, call center, post office, apps (including the Fixed signs and billboards are also useful ways to LIMA app) agencies (e.g. petrol stations). In particular, it is communicate toll charges at appropriate locations on the recommended that a major distribution channel should road. be through Customs posts at border crossings as: As the contractor will not be in place for some time, • The major requirement for route passes and short this communication work needs to start well before any duration e-vignettes will come from foreign vehicles procurement begins, for example: transiting Bulgaria. Thus the entry point to the country is a • To “sell” why tolling is necessary to the public and fleet logical place to sell route passes and e-vignettes. operators • Customs posts already sell paper vignettes and thus • To explain the move to an e-vignette have the experience and procedures in place to sell route passes and e-vignettes. Naturally, the systems will require • To show that Bulgaria is not alone in tolling to make modification and interfacing with the Contractor’s system roads better to record sales made in real-time • To inform users of likely toll rates, so fleets can add these Since the prices of route passes and e-vignettes will be cost to their customers’ contracts directly linked to the vehicle class (MPGVW, emissions • To quell any false rumours and disinformation class), the Contractor will be responsible for verifying the class declared by the user in the same way as an NSP, EP or There are many national schemes that have failed TP (see NSP below). to reach procurement / operation because this user engagement did not start early enough, and rumour and Responsibility for Communications and general misinformation meant a groundswell of public opposition customer information built quickly. Central Government typically will define a communications programme as Ministers will want to be Support to SPs in resolving customer issues seen to be overseeing the deployment. They will define Users will interact directly only with their NSP / EP, and the “look and feel” of the tolling brand, engage with a user with a billing or similar query will turn to them senior stakeholders in industry and user groups, and deal first. This may be by phone, web, in writing or by app, with the media proactively. Below this, the Government depending on the NSP. Typically cost considerations body (SPE or other) and where required the Contractor will automatically encourage digital services. However, will be responsible for providing to the general public since the calculations of tolls due are carried out by the and to users general information about the e-tolling and Contractor, the NSP / EP will not always be able to resolve e-vignette system. This will include: such queries and will turn to the Contractor for help. When • The extent of the toll road network, including road there is an appeal against a fine, this will go to the SPE classifications potentially using the RIA GIS who will have issued it. • Toll tables Resolving customer issues of TP users • Information on enforcement, appeals and penalties for TPs only provide location data to the Contractor and it is non-compliance the Contractor who bills the user. In such a case, the user • Information on NSPs, EPs and TPs and how users may will turn to the Contractor to resolve all queries. Since it register with them is the TP who was responsible for registering the vehicle • Information on any disruptions for e-tolling purposes, the Contractor may need to turn to the TP for vehicle class registration information required to The above information will need to be provided via resolve a customer query. Issues relating to the on-board website, call center, newspaper or TV advertisements, equipment supplied by the TP would need to be resolved brochures etc. as appropriate by the Service Providers by the TP and not the Contractor. and Contractors. They will need to work closely with Government regarding policy communications. Reporting Typically in tolling projects Government delegates the development of the material to its Contractor within The Contractor will be responsible for providing guidelines and approves all communications. A separate comprehensive reporting to Government on all aspects document has been prepared based on case studies of of e-tolling and e-vignettes, including reports on system previous schemes where lessons can be learnt. performance and operation and financial reports. 27 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability RIA will retain responsibilities for: The KPIs should cover all aspects of the service, such as accuracy and timeliness of toll calculation, accuracy of Working with Ministry of Regional Development and violation detection, customer information availability Public Works to provide data to the Ministry regarding the etc. However, whilst it is important that all aspects of the road network (operational and financial) and tolling data service be covered, they should be limited to the most to enable the Ministry to set toll rates. essential ones. Experience in other countries shows that too many KPIs can be unmanageable and that focus can Government (SPE or other) will retain be distracted from the most important ones. responsibilities for: It is also important to note that the contract is not Providing the Contractor with relevant information about governed solely by the KPIs. They are specific measurable the toll network and rates, exemptions, details of Service parameters. However, just because the Contractor meets Provider and EETS Provider contractual framework and the KPIs does not absolve him from meeting other other information required for the Contractor to produce a contractual requirements. Toll Domain Statement. The contract will also include specific requirements as In establishing contracts with NSPs, EPs and TPs, although outlined in Deliverable 1 section 10.7 for example for cyber Government will be supported by the Contractor in security, financial management surety such as the PCI – its negotiations, the formal contract will be between DSS standards, data interoperability and foreign language Government and the relevant NSP/EP/TP. The contract support for example. These will be specific outcome with the NSP, EP, or TP will need to cover technical matters based requirements only used to ensure the service is such as details of interfaces. These may be included in tailored to Bulgaria and not to restrain the Contractor in the main contract with Government with the Contractor his design. For example the Contractor may decide to being a party to that contract, or they may be covered in a use cloud based storage, his own data centre or a mix separate contract. of both. Provided he meets Bulgarian and international requirements for data security and storage, availability in Contractual Relationship between TC and Contractor disaster, resilience against local issues such as floods and Government should appoint a single Contractor to carry power outage and delivers all other KPIs the decision is out all duties on behalf of Government (apart from any up to them based on their experience and market forces. penalty and appeal related duties which need to be These detailed requirements will be included in the next carried out by a separate government enforcement body Stage. as discussed below). The Contractor may of course appoint E-tolling, route passes and e- vignette are three separate sub-contractors but it will be his responsibility to manage ways to pay but will all be supported by one contract with them and not Government’s and he will be responsible to the Contractor. There is currently no IT system with data Government for their performance. held re vignettes so there is no transition. This does mean The procurement should be drawn from companies with the Contractor will have to provide integrated solutions to experience in EU tolling systems and services. They should all three functional requirements but there are already off have proven ability to provide tailoring to Bulgarian the shelf systems that can do this. standards and meet local needs need for IT standards, The contract between Government and Contractor should customer service, cyber security and the local scope of the also include a change mechanism, including how changes project. are to be agreed, what constitutes a change which the If no single entity is able to bid as the Contractor, Contractor is entitled to be remunerated for and how Government may accept different structures of bids that remuneration is to be established. This could include from for example a lead Contractor with a consortium or volume of transactions and/or users and a fixed fee. Joint Ventures. This would need “back to back” contract terms and conditions and also may mean unnecessary margin is added to cover risks that should be transferred National Service Providers (NSPs) downwards. Although an NSP will only operate in Bulgaria, this does The contract between Government and the Contractor not necessarily mean that its customers will be exclusively will be for the delivery of a service and will include a series Bulgarian. In the long term, users who use toll services in of Key Performance Indicators (KPIs) which the Contractor other countries are likely to use an EETS Provider but in the will be required to meet. Failure to meet these will result in short term, a non-Bulgarian user may choose to register contractual penalties. with a Bulgarian NSP, as: 28 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability • No EETS Provider yet covers Bulgaria; or details, this would improve data accuracy and hence give more accurate toll charging and operational savings in • The user’s EETS Provider does not yet cover Bulgaria (an enforcement. Such access would not be unlimited. EETS Provider has up to 2 years from first registration to The NSP would supply the vehicle registration number establish contracts with all European toll domains); or and obtain back only the agreed minimum of information • Other countries in which the user travels do not operate required. Alternatively an offline subset of the data electronic toll systems (e.g. Greece) or are not compatible could be provided on a daily, or more frequent, basis. with EETS (e.g. Turkey) Such access would mean that since vehicle registration The responsibilities of the NSP include: documents would not have to be physically presented, it would be possible for NSP users to register for e-tolling Ensuring the provision of on-board units to users; on-line and have the on-board equipment distributed by Registering and verifying vehicle class data post. This would improve efficiency. Such an option would be restricted to Bulgarian vehicles as NSPs would not In many cases this will mean actual supply of an on- have access to the vehicle registration databases of other board unit by the NSP who will need a supply of suitable countries. on board equipment, but where the vehicle already has a GNSS unit fitted (which may in the future be a smartphone), this may mean ensuring that the already- Invoicing and Collection of Tolls from Users installed unit is suitable for e-tolling. DSRC would not be Once the Contractor has received location data from the supported for toll collection following the Government NSP, the Contractor calculates the tolls due and invoices decision in deliverable 1. It should also be remembered the NSP. The NSP is then responsible for invoicing the user that the Euro-vignette Directive prevents mixing of and collecting the tolls due. technologies between vehicles types – eg heavy vehicles can be e-tolled or e-vignette but not both. Guaranteeing Tolls incurred by Users Where the on-board unit is supplied by the NSP, it is the The NSP is responsible for payment of toll claims NSP’s responsibility to organise the distribution and, irrespective of when or whether the NSP is himself paid by if required, fitting. Distribution points can be located the user who incurred the tolls. The NSP is usually required wherever the NSP sees fit, for example at petrol stations. to provide some form of guarantee to Government in A logical option is at border crossing points, to allow respect of toll liabilities, which may be drawn on by vehicles coming into Bulgaria to acquire on-board units Government in case of default of the NSP. This guarantee and register for e-tolling immediately on entering Bulgaria. may be in the form of a bank guarantee, an insurance This requires sufficient space to set up such a distribution based guarantee or a parent company guarantee. center or multiple centers for many NSPs, including parking. Unlike the sale of e-vignettes and route passes Managing User Accounts by Customs, the distribution of on-board units, although It is the responsibility of the NSP to manage the user’s located at border crossings, would be independent of account. It is entirely a commercial decision as to whether Customs. to offer pre-pay or post-pay accounts or both, whether Associating the on-board unit with a vehicle and ensuring to require guarantees for post-pay accounts or to rely on that the correct vehicle class details (MPGVW, emissions credit checks, how frequently to invoice post-pay accounts class etc.) are correctly registered is essential. It is the and what period to allow for payment, how many vehicles responsibility of the NSP to ensure that the vehicle class to allow on one account etc. details provided by the user are correct. The NSP is liable for all tolls incurred by his users. However, Verification of vehicle class can be done by physically if a user terminates his contract, has his on-board unit lost checking the original vehicle registration documents and or stolen or breaches the terms of his agreement with the having the NSP’s operator enter the information into their NSP (for example by not paying his post-pay invoice), the system. This potentially allows errors to be introduced into NSP will no longer wish to take liability. He then sends to the system, either because there are errors (or forgeries) in the Contractor a list of vehicles or on-board units for which the registration document or error in data entry. This may he no longer takes responsibility. If a vehicle on such a lead to wrong tolls and unnecessary enforcement and the list is detected travelling on toll roads, he is subject to possibility of users having penalties issued incorrectly. enforcement. If the NSP can have on-line access to the Bulgarian Pre-pay accounts in e-tolling are similar to pre-pay vehicle registration database to verify vehicle class accounts in mobile telephone networks. However, when 29 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability a mobile telephone user’s pre-pay credit runs out, he • Claims procedures will be unable to make calls. The exposure of the phone • Support to be provided by the Contractor to the NSP in operator is therefore limited. By contrast, if a toll payer’s respect of customer queries pre-pay credit runs out, the user can still drive along tolled roads. In these circumstances, the NSP would place all the • Service Level Agreement (see below) and penalties for vehicles and on-board units associated with that account breaching the SLA on the list which he sends to the Contractor, thereby • Maximum time between receipt of a list by Contractor relinquishing responsibility. Once the user tops up his credit, he is removed from the list. and the list going live The user remains the responsibility of the NSP until such • Remuneration of the NSP by Government. As discussed time as the NSP places that user on the list. If the NSP in deliverable 1 section 4.7.8, this may be per transaction, tracked tolls incurred for example only once a day, then a per user, percentage of toll revenues, fixed monthly fee or user could run up a day’s tolls for which he did not have any combination of these or other similar parameters. sufficient credit. Therefore the NSP needs to keep track of • Fees to be paid by the NSP to Government for the the tolls on a near real-time basis. This in turn means that suitability for use testing the NSP needs to pass location data to the Contractor immediately that he receives it from the user’s on-board The contract will also need to cover details of interfaces unit, the Contractor needs to process those location data between the NSP and the Contractor and technical immediately on receipt and pass to the NSP details of the details of suitability for use tests for these interfaces to tolls. This in turn has implications for the design of the ensure interoperability. These may be included in the Contractor’s back-office. main contract with Government with the Contractor being a party to that contract, or they may be covered in a separate contract between Contractor and NSP. Contractual Relationship between NSP and Further arrangements will apply for EETS Providers. Government/ Contractor These details will be addressed in the next Stage. The The main contractual relationship of the NSP is with the Service Level Agreement needs to be robust as it defines Government but so there is a level playing field between the relationship and anchors the overall performance competing NSPs, the contractual terms and conditions expectations. It will need to specify Key Performance must be the same for all and are set out in the Toll Domain Indicators (KPIs). These should cover matters such as but Statement. While minor details may vary between not limited to: contracts, these cannot be significant enough to result in a legal challenge. • Accuracy, completeness and timeliness of location data provided by NSP to Contractor The key elements covered by the contract include: • Accuracy and speed of provision of data on tolls incurred • The conditions that an NSP must fulfil to enter into by Contractor to NSP a contract. These may include factors such as relevant experience and financial stability. Any entity which fulfils • Availability of interfaces between back offices these conditions is permitted to enter into a contract with • Response times for message exchange over interfaces Government to become an NSP • Speed of support from Contractor to NSP for billing • The fact that the NSP guarantees tolls incurred by its queries from NSP’s customers users • The level of financial guarantee that the NSP must provide and the circumstances in which the guarantee will EETS Providers (EPs) be drawn The responsibilities of an EETS Service Provider and its • How quickly the NSP must provide location data to the contractual relationship are essentially the same as those Contractor and how quickly the Contractor must provide of an NSP but the key difference is that an EP provides information to the NSP about toll transactions customer service elements for many countries, using a single on-board unit and account. The EP can be based • How frequently the Contractor bills the NSP on behalf in any country in the EU and its customers do not have of Government and the timescales within which the NSP to be from the country in which the EP is based nor must pay these invoices from Bulgaria. This leads to some secondary differences • The bank account into which payment should be made between an EP and an NSP. 30 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability An EP, like an NSP, will have responsibility for ensuring that • The use of EUCARIS (EUropean CAR and driving the vehicle class data registered by the EP are correct. license Information System) and the Salzburg forum (a However, while it is possible that an NSP may have access cooperation initiative between the Interior Ministries of to the Bulgarian vehicle registration database, it is unlikely eight European countries) to issue penalties to foreign that an EP would have access across the whole of the EU. users, in a similar way to that currently used to issue So an EP would have to validate vehicle registration data penalties for speeding offences to owners of foreign on the basis of physical documents, unless it chose to vehicles. This can be backed up by use of civil courts restrict its services to users whose vehicles are registered to follow unpaid tolls across Europe as is done in many in countries in which it did have access. schemes. Whereas an NSP would optimise its distribution network • Customs no longer being fully required to be involved for on-board equipment for users in Bulgaria, an EP would in enforcement. The principal reason for initially proposing target customers. Thus it is entirely possible that an EP the involvement of Customs was to ensure that there was providing a toll service in Bulgaria would not have any effective enforcement of foreign vehicles, which otherwise distribution in Bulgaria. could only be enforced by means of stops by Mobile Enforcement Units. The use of EUCARIS / Salzburg Forum means that there is potentially an effective method of Toll Declaration Data Providers (TPs) enforcement of foreign vehicles and the involvement of Customs is no longer required but may be an additional The responsibilities of a TP and its contractual benefit to be discussed. Stopping vehicles at borders relationship with the Contractor / TC are similar, save is likely to be continued by law until Bulgaria joins the that responsibilities of invoicing and collection of tolls, Schengen area and this gives an additional level of foreign guaranteeing tolls incurred, and managing user accounts enforcement do not apply, with the exception of listing vehicles and on-board equipment if they are lost, stolen or cease • Mobile enforcement units (MEUs) being used primarily to be customers. Similarly, the contractual elements for the gathering of enforcement data (for issuing (including KPRs and SLA) would not include such penalties centrally) rather than for stopping of vehicles. matters. MEUs may still be used to stop vehicles in defined cases but this will no longer be the primary purpose. If they do they will need a body with legal powers to stop vehicles in D Enforcement attendance. Overview The technology for MEUs has moved on recently, with options ranging from very mobile tripod-mounted An overview of enforcement in Bulgaria was provided equipment, through semi-permanent sites to van- in Deliverable 1. Since Deliverable 1, the enforcement mounted integrated equipment. The choice should be left concept has been refined to include: to the Contractor. 31 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Figure 5. Semi-permanent MEU Designs Figure 6. Tripod Temporary MEU 32 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability The proposed enforcement concept is as set out below: • Access to the vehicle registration database • Enforcement gantries will be installed on toll roads in • Vehicle classification Bulgaria. These will wherever possible use existing traffic • Responsibility for tracking payment of penalties count structures, adding equipment where possible or at least using their power and communications. Some extra The proposed enforcement concept for foreign vehicles sites may be needed at key points. is intended to be similar to the process used by the Police for enforcement of speeding offences. However, • When a vehicle passes under an enforcement gantry, detailed information has not been received from the a digital image is captured (including its number plate) Police regarding the agreements in place governing their and classification equipment establishes its approximate cooperation with foreign enforcement bodies in respect of size (which approximates to its weight class) and whether enforcement of foreign vehicles. It is therefore not possible it is towing a trailer. Note that this is only used for to say with certainty whether such agreements can be enforcement, not for tolling. Hence image quality needs adapted for the enforcement of e-tolling and e-vignettes to be high but not as good as for toll collection. As manual with respect to foreign vehicles and therefore whether review is likely to be used before any penalty is issued the enforcement concept can be fully implemented for there is no reliance on ANPR technology. foreign vehicles. • The system, either at the roadside or in the back office In addition to the proposed enforcement concept (more establishes whether an offence was being committed (lack fully described below), there are a number of other, non- of a valid on-board unit, route pass or e-vignette; vehicle exclusive, options for foreign vehicle enforcement. These class declared by the on-board unit does not correspond are: to the actual vehicle class) • The use of a European Debt Recovery Agency (EDRA), in • If no offence was being committed, the image is deleted a number of variations • If an offence was being committed, the details of the • The use of MEUs to issue penalties to foreign vehicles at offence (including images) are sent to the enforcement the roadside body, which issues a penalty to the vehicle owner by post • The continued use of Customs to issue penalties to • If the penalty is not paid within 30 days, the penalty foreign vehicles on exit from Bulgaria is forwarded to the National Revenue Agency (NRA) for enforcement Annex C discusses in more detail the issues surrounding the enforcement of foreign vehicles and the options • The NRA forwards unpaid penalties for foreign vehicles available if the proposed database driven enforcement to the corresponding enforcement body in the country concept proves impossible to implement for foreign of origin of the vehicle for enforcement. The incentive vehicles. for the foreign enforcement body to enforce the penalty is that that body keeps the revenue from the penalty – conversely any penalties sent to Bulgaria for enforcement Policy Areas Requiring Decisions from another country are retained by the Bulgarian Access to the Vehicle Registration Database enforcement body. There are other options for foreign enforcement as detailed below. In any e-tolling system there is a temptation for users to falsely declare their vehicle as belonging to a class which • MEUs are used to supplement fixed enforcement has a cheaper toll rate, for example, in class Euro 5 rather gantries. In general they act as moveable enforcement than class Euro 2. Such potential misregistration is a gantries, gathering evidence in the same way as fixed particular problem for e-vignettes and route passes. While enforcement gantries, with the penalty being issued from obtaining an on-board unit and setting up an account the back office of the enforcement body and not at the justifies rigorous registration and verification, for a simple, roadside. low-value product such a complex registration is unlikely • In certain circumstances, where the standard processes to be justified. It is quite likely that a sales route would be are not able to automatically detect a violation, MEUs on-line, where physical registration documents could not may be used to stop vehicles to check for those specific be presented. violations provided a body is present with legal powers There are two options to ensure that declared vehicle class to stop the vehicle. In such cases, penalties would still be data are correct: issued centrally • Enforcement checks The precise division of responsibilities in enforcement depends on policy decisions in: • Verification at registration 33 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Clearly, it is not practical to check every vehicle. Therefore Vehicle suspension type does not form part of the there must be a reason to carry out such a check. For standard EU vehicle registration document and therefore weight based classes, automatic roadside classification can it would be extremely difficult to verify suspension type measure an approximation of the vehicle’s weight. If this at vehicle registration. In addition, roadside classification differs from the declared weight class, then a check on the systems are not capable of detecting suspension type. vehicle registration database can be carried out (directly in Similarly, although EU vehicle registration documents the case of Bulgarian vehicles or through EUCARIS in the may contain axle counts, they do not have to. While axle case of foreign vehicles) to verify the actual vehicle weight sensors exist, their level of accuracy, particularly in free- class. flow conditions, is insufficient to serve as the basis for However, for emissions class, it is not possible for roadside enforcement. systems to check the actual class of the vehicle. Therefore Therefore the only practical way of enforcing vehicle such checks would need to be carried out at random. This classification based on axles or suspension type would be could be done by capturing images of vehicles and then by means of random vehicle stops by MEUs. checking the number plate against vehicle registration databases or by stopping vehicles at random and In practice, classification of vehicles for the purposes of checking their documents. If such checks are carried out the current vignette is not done according to axle count by stopping vehicles at the roadside, this would need to or suspension type and as set out in Deliverable 1 it is be carried out by a public body and not by the Contractor. recommended that such a basis is not introduced for Such random checks naturally carry a cost. e-tolling and that the relevant aspects of Ordinance No However, if bodies registering vehicles for e-tolling and 160 are repealed. for route passes and e-vignettes had access to the vehicle registration database, then rigorous verification can be Maximum Permitted Combined Train Weight carried out at registration so random checks become According to the Roads Act, vehicles (but not passenger unnecessary. Such access would preferably be on-line and vehicles) which have a Maximum Permitted Gross Vehicle real-time but an off-line data access frequently updated Weight of under 3.5 tonnes and which are towing a trailer would suffice. such that the combined maximum permitted gross train A decision on access to the vehicle registration database weight is over 3.5 tonnes are classified as vehicles over 3.5 by NSPs, EPs, TPs, and the Contractor therefore has a direct tonnes. impact on who operates MEUs – a uniformed public body To enforce effectively, it is necessary to distinguish or a private body (which simply drives the MEUs around between: and does not have the legal power to stop vehicles). This in turn has cost implications (private sector employees to • A vehicle towing a trailer which does not have on-board simply drive vehicles are likely to be cheaper than trained equipment because the combination remains below 3.5 uniformed public sector officials).. tonnes and • A vehicle towing a trailer where the combination is Vehicle Classification above 3.5 tonnes but which is cheating. Deliverable 1 identified that whilst it is possible to However, automatic enforcement equipment is only calculate tolls on the basis of axle counts, suspension able to identify that whether a vehicle is towing or not types and maximum permitted gross train weight, and is not able to establish the MPGVW of the trailer. electronic tolling based on these principles makes It is therefore not possible to establish the combined automated enforcement extremely difficult. The difficulty maximum gross train weight in this way. Vehicle trailers in all cases is establishing whether a vehicle which is themselves do not require on-board equipment and declared in one class is actually in that class. therefore would not be registered so their MPGVW cannot be established his way. Establishing the MPGVW of a trailer via checks with the vehicle registration database is also Axles and Suspension Type not feasible since trailers may not necessarily be registered Article 32 and Attachment 1 of Ordinance No-160 state in Bulgaria and not all countries require trailers to be that vehicles will be classed according to number of axles, registered. The only way to enforce in these circumstances is for MEUs to stop vehicles at the roadside with suitable vehicle dimensions and weight and other classification legal powers from an associated body in attendance. characteristics and that classification characteristics shall be determined by suspension type, number of axles and As set out in Deliverable 1 it is therefore recommended maximum permitted gross vehicle weight. that the toll class is set on the basis of the maximum 34 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability permissible gross vehicle or train weight of the vehicle Responsibility for Tracking Payment of Penalties and / or the simple fact of towing or not towing a trailer. Once a penalty has been issued, its payment (or The financial model has assumed a combination of: otherwise) must be tracked. This can either be done by • MPGVW of the vehicle and / or Maximum permitted the body issuing the penalty or by the Contractor. If by train weight of the vehicle the Contractor, then the Government enforcement body (SPE or otherwise) must pass to the Contractor details of • Euro emissions class of the vehicle penalties issued – date of issue, amount, time for payment, • Whether the vehicle is or is not towing a trailer, reference number, discounts for early payment. The regardless of the MPGVW of the trailer Contractor must have access to the relevant bank account (at least on a read basis) in order to track payments. This At first sight such a change would appear to be issue needs to be decided at an early stage as it will affect inconsistent with the Euro-vignette Directive. However, the tender specification. although that Directive applies to vehicle trailer combinations over 3.5 tonnes, it does not say that a vehicle trailer combination over 3.5 tonnes must be Contractor Responsibilities charged in the same way as a vehicle over 3.5 tonnes on Infrastructure Provision its own. It simply states that for a given class of vehicle The Contractor is responsible for provision of the either a vignette charge or per km charge can be levied. enforcement roadside infrastructure, i.e. enforcement Thus if vehicle classes were defined in a way similar to gantries including ANPR cameras, vehicle classification that set out below, this would both be consistent with the etc. It may be possible to utilise the existing traffic count Euro-vignette and would permit automatic enforcement. camera infrastructure. However, there are significant • Class 1 – Vehicles under 3.5t and maximum train weight differences between these cameras and tolling system under 3.5t, irrespective of whether towing a trailer or not enforcement cameras. These differences include: • Class 2 – Vehicles under 3.5t and maximum train weight • Tolling enforcement gantries include additional above 3.5t, not towing a trailer equipment such as additional cameras • Class 3 – Vehicles under 3.5t and maximum train weight • Tolling enforcement gantries require complex roadside above 3.5t, towing a trailer, irrespective of the type of control systems trailer Thus in practice such sharing of structures may not be • Class 4 Vehicle above 3.5t and below 12t and maximum possible. However, this can be established at the tender train weight below 12t, irrespective of whether owing a specification stage. At the very least these sites provide trailer or not power and communications and maintenance access • Class 5 Vehicle above 3.5t and below 12t and maximum useful to help tolling. train weight above 12t, not towing a trailer The Contractor is also responsible for providing the Mobile • Class 6 Vehicle above 3.5t and below 12t and maximum Enforcement Units including all relevant enforcement train weight above 12t, towing a trailer systems. Responsibility for maintaining them lies with the • Class 7 Vehicle above 12t or vehicle designed to tow a Contractor. Responsibility for day to day maintenance semi-trailer, irrespective of whether towing the semi-trailer (fuelling, cleaning etc.) of any vehicle used lies with the or not entity operating the MEU, which may be the Contractor whilst regular maintenance (e.g. servicing) may lie with • Class 8 Bus either the Contractor or the entity operating the MEU. Note that this is an illustrative classification not a definitive proposal. List Management It will be important for a firm decision to be taken on NSPs, EPs and TPs are responsible for providing the vehicle classification at an early stage as it will affect the Contractor with lists of on-board units which are no longer tender specification. valid. Driving with such a unit means a violation is being committed. The Contractor is responsible for managing A decision on vehicle classification has a direct impact these lists and in particular for distributing them to the on who operates MEUs – a uniformed public body or a enforcement gantries and MEUs. private body (which simply drives the MEUs around and does not stop vehicles). This in turn has cost implications Depending on the design of the Contractor’s system, he (private sector employees to simply drive vehicles are may also receive other lists from NSPs, EPs, and TPs – for likely to be cheaper than rained uniformed public sector example lists of valid on-board units or exempt vehicles. officials). The Contractor is also responsible for managing these lists. 35 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Operating MEUs The process of creating Evidential Records and validating them is continually adjusted over time. In particular, it can As discussed above, the role of MEUs is primarily to act be expected that as the Contractor and the Enforcement as moveable enforcement gantries. If in addition they Agency gain experience in enforcement, that it may be are used to stop vehicles to check for violations then any necessary to change processes or change aspects of the MEUs which are being used for that purpose would have to be operated by a public enforcement agency with law, which may have an impact on processes. The tender legal powers. However, any MEUs used solely as remote specification for the procurement of the Contractor should moveable enforcement gantries would be operated by allow for such changes. the Contractor. Passing Evidential Record to the Enforcement Body Violation Validation Validated Evidential Records are passed to the There are two stages of violation validation which the enforcement body for further checks and issuing of Contractor is responsible for: penalties. • Establishing that a violation may potentially have occurred Tracking and reconciliation of penalty payments • Checking that the evidence supporting the potential The Contractor may be responsible for tracking the violation is correct payment of issued penalties and reconciliation of payments with outstanding penalties (see above). Establishing that a violation may potentially have occurred Enforcement Body (SPE or other) Responsibilities The process which the system goes through to establish Operating MEUs whether a potential violation has taken place is described MEUs primarily act as moveable enforcement gantries. below. At the end of this process, an “Evidential Record” is If in addition they are used to stop vehicles to check for created, which contains as a minimum: violations they would have to be operated by a public • Images of the vehicle allegedly committing an offence, enforcement agency with legal powers. Any data gathered including a close-up of the number plate and a context in automatic mode would be sent to the back office and image showing the location of the offence processed in the same way as from a fixed enforcement • The vehicle registration number read from the number gantry, as discussed above. plate image either by ANPR or manually, and most likely verified manually also Validation of Evidential Records • Time and place of the offence The Evidential Records serve as the basis for the • Offence allegedly committed (e.g. no on-board unit administrative process. The enforcement body is detected) responsible for further validation to establish to the standards of the Administrative Violations and Sanctions • Relevant supporting evidence (e.g. data obtained from Act that a violation did in fact take place. This may the on-board unit or from lists supplied by NSPs, EPs or TPs) include: This also filters out vehicles which are known to be • Checks against the vehicle registration database if the exempt from tolls and which therefore are not committing Contractor does not have access an offence. It is important to note that if a vehicle is not committing an offence, then all images taken and • Checks of vehicle data against international vehicle associated data are deleted from the system. Exemptions registration databases through EUCARIS if the Contractor are defined in Bulgarian law (see deliverable 1 annex 4) does not have access and there are very few vehicles that are exempt (Ministry • Obtaining owner data from the Bulgarian and of Interior, Ambulance, Army, agricultural tractors, disabled international vehicle registration databases. Even if the persons). Using this strict and narrow legal definition it is Contractor is able to obtain data from the database, it is unlikely that significant leaks of revenue will be seen as possible that data may be considered sufficiently sensitive has been observed in other countries where exemption that the Contractor will not have access to this. Owner definitions are less stringent. Exempt vehicles will be data are required to establish to whom the penalty is sent identified by their number plate from either a special register of exempt users or direct from the registration • Checks against any other sources of information, such as database. lists of exempt vehicles received from the police 36 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability • Investigating any extenuating circumstances with the Tracking and reconciliation of penalty payments owner. The Contractor may be responsible for tracking the The enforcement body is responsible for providing payment of issued penalties and reconciliation of feedback to the Contractor resulting from the validation payments with outstanding penalties (see above). process. For example, if owner checks establish that a particular vehicle is exempt by virtue of its ownership Creation of Enforcement Body eg disabled vehicle, army, this should be fed back to the Contractor so that further evidential records for There are 4 potential options for establishing a tolling this vehicle are not sent out. The Contractor does not enforcement body: necessarily have to be told who the owner is – simply • Widening the duties of an existing enforcement agency that the vehicle is exempt. In addition, any vehicle data such as Police or Customs obtained from vehicle registration databases which the • RIA Contractor does not have access to, such as the actual vehicle weight class should be fed back to the Contractor. • The SPE • A new dedicated enforcement agency for roads Issuing Penalties Note that the Contractor cannot legally issue penalties Penalties are issued in accordance with the Administrative (but can for example print them and post them). The Violations and Sanctions Act and as such can only be Police have indicated that they focus on offences which issued by an authorised public enforcement body and result in fatalities and that enforcing tolling violations cannot be issued by a private Contractor, even if acting on would not fit with this focus. Furthermore, they indicated behalf of the Government. that they lack resources to fulfil their existing duties related In a manner similar to the procedures used by the Police to speeding etc. An advantage of using the Police would for issuing penalties for speeding offences to Bulgarian be the experience that they have of issuing penalties for vehicles, penalties are issued centrally by post to the speeding. owner of the vehicle. No penalties are issued at the Customs have indicated that they would be prepared to roadside. issue penalties to vehicles at the border and to collect In a manner similar to the procedures used by the Police payments, provided that they were provided with for issuing penalties for speeding offences to foreign complete documentation of the violation such that vehicles, unpaid penalties for such vehicles are sent to the they could simply collect the penalty revenue. In effect, enforcement body in that country. To give that foreign Customs would simply act as a collection agency – a body an incentive to pursue the penalty, the foreign separate body would still be required to issue penalties. enforcement body keeps the revenue raised (the Bulgarian Moreover, Customs would only enforce at the borders – enforcement body keeps the revenues raised from any a separate agency would be required to enforce at the penalties sent or enforcement to it by foreign enforcement borders. This approach may be appropriate for vehicles bodies). It should be noted that the aim of enforcement is registered in countries which are not part of EUCARIS and not a revenue-raising exercise but to provide an incentive with which Bulgaria does not have agreements to enforce for users to comply with their tolling obligations. each other’s penalties. An alternative used in many countries is to pursue Although RIA has powers under the Roads Act to enforce the debt from a foreign vehicle in civil court using a vignettes, in practice these powers are little exercised. Thus specialized European Debt Recovery Agency. in many respects using RIA as an enforcement agency would be like setting up a new body as new resources and Enforcement of penalties skills would be needed. It is usual practice within many countries for a discount Lastly, it would be possible to set up an entirely new to be given if penalties are paid promptly. In Bulgaria, enforcement body, either as a separate body or as part there is a 30% discount on speeding penalties if paid of the SPE. The chief advantage of this is that a dedicated within 30 days. If a penalty is not paid within 30 days, it agency would not have other enforcement responsibilities and could be optimised for e-tolling enforcement. is sent to the National Revenue Agency for enforcement and recovery. Any costs incurred by the NRA are added Whichever approach is decided upon, the enforcement to the penalty. Penalties sent to foreign enforcement body must be set up quickly so that it can participate in bodies are of course handled according to the the initial design of enforcement. Experience from other procedures of that body. countries shows that if they are not involved at an early 37 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability stage, the process takes time to be optimised after the traffic hub at a given location. A simple search could start of tolling. In setting up the enforcement agency, it identify the owner of that location and hence who he is recommended that representatives of the Police are is trading with. Although the system would only be seconded for a period to share their experience. providing raw data and not carrying out such analysis, careful consideration must be given to whether this In setting up a tolling system, it is essential that room is found in the government budget for setting up and would nevertheless breach Data Protection running the agency – staff, training, accommodation, IT, requirements. postage for penalty notices. It is often the case that the Based on discussions held with Customs and Police, a focus is on the budget for the tender for the Contractor number of use cases have been developed which relate and this element, which is not funded directly through the to data use by these bodies. These are discussed in tender, is overlooked. Annex 1 and will be developed further with the relevant stakeholders in the next Stage of work in preparing the tender specifications, as part of the stakeholder E Other Bodies requirement capture activities. Vehicle Registration Database Access will be required to data from the vehicle F Conclusions registration database. Ideally, access should be granted to the NSPs, EPs and TPs as well as the Contractor but at • The proposed institutional model is based around the a minimum, access must be granted to the enforcement Toll Charger / Service Provider model upon which the EETS body. Access needs to be on-line and real-time if possible Decision is based but for bodies other than the enforcement body offline • A single Special Purpose Entity (SPE) can fulfil all Toll can be acceptable. Appropriate interfaces will need to be Charger roles apart from road management and setting defined and built. The volume of enquiries is likely to be toll rates which remain the responsibility of RIA and the high which may mean that the capacity of the database Ministry of Regional Development and Public Works may need to be expanded or an offline copy taken. respectively. It will not be able to be in place to start procurement however. Audit Body • Provision of GNSS units which are provided by a E-tolling systems are large and complex and the amounts combination of : of money collected through them significant. It is likely to be necessary to appoint an audit body to ensure that  ational Service Providers (NSPs) providing e-tolling – N the system is performing accurately, that Key Performance services to users only in Bulgaria Indicators are being met, and that all tolls are being  ETS Providers (EPs) providing e-tolling services to – E charged and collected. users in Bulgaria and in other EU countries, using a single on-board unit and account for all countries Bodies Requiring Data from Toll System  oll Declaration Data Providers (TPs) providing –T An e-tolling system generates large amounts of data used location data to the Contractor but not providing a for purposes other than e-tolling. Various bodies such as full Service Provider service to their users Police, Customs, and RIA have expressed interest in such data. These data should be placed in a separate depository • The Contractor also fulfils the role of a dedicated such that they do not have an operational impact and National Service Provider (NSP) and customer billing made available to authorised bodies to carry out their functions in relation to users of TPs own analysis. Early consideration should be given to the • Government must fulfil the enforcement role and sizing and performance of this depository, the formatting whatever choice is made, this body needs to be set up and organisation of data, interface and cyber and physical quickly so that it can participate in the detailed design security requirements, and how the depository should be funded. The interested bodies should be involved at an • For ease of enforcement, tolling should not be based early stage. on axles, suspension or weight of combined vehicle and trailer Consideration must be given to Data Protection and cyber security implications. Even if raw data were anonymised, • Efficient enforcement requires on-line access to the analysis of the data could enable persons or firms to be vehicle registration database for enforcement purposes identified. For example, traffic analysis could identify a and at least offline access for vehicle and owner checks. 38 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability 3 Technology and Operational Model A Overview E-tolling systems depend on data collected from road users about passages of their vehicles within the tolled Objective road network. Risks associated with the technology for this are well understood and managed to acceptable levels. This section addresses the TOR requirement. For example, algorithms are used to generate missing Developing a model for the operation of the system for parts of a vehicle’s journey based on the chain of data electronic toll collection (tasks, responsibilities, workflows, received. This uses GNSS data and the Contractor may interfaces, etc.). choose to supplement this with DSRC enforcement, e.g. The following sections describe the main business for EETS vehicles. processes involved. The functional architecture for the If fleet management devices are used to declare journey system and organizational model is also described. The data to the Contractor there are potentially additional responsibilities and main processes of the Contractor are technical risks as the units are not designed specifically for also described, together with processes to be supported tolling. Government may incur high enforcement costs by other parties such as Government. and higher costs associated with resolving toll charging Firstly, four key high level questions are considered which disputes but equally costs of deployment and speed of are: deployment are reduced. This is a manageable risk, but it depends on the approach that Government wishes to take • What are the main technology-related risks and how to revenue loss compared to enforcement expenditure. should they be managed? Further technology-related risks are associated with • How to ensure adequate whole life maintenance and the back office itself. The possibility of a catastrophic support? event impacting data means that resilience strategies • What activities does Government wish to be involved in should be put in place to ensure that toll revenue is not as part of implementation/operation of the system? lost. Back offices should be capable of being operated from a second location if for example there is a power • What type of technical competences and experience are outage affecting the main office. Software should be fully needed to implement and operate the system? mirrored, so that loss of one data center does not prevent the system from operating and a second data center can What are the main technology related risks and how be brought on-line seamlessly. Good practice should should they be managed? also be used relating to stored data and security policies should cover data storage requirements for different E-tolling systems are now extensively deployed classes of data. The main risk here is that the security throughout the world. All of the main technology-related policy is either not adequate or is not followed correctly by risks are well known and can be managed effectively. all parties and within all processes. The main technology risks are actually from introducing non-standard or unique requirements for a specific Relating to enforcement, firstly the risk that a vehicle country. This means the Contractor has to compromise is not correctly identified and classified by automatic an existing well-proven design or add new features which enforcement equipment could mean that some violation have not been extensively tested or for which there is no cases are not detected. For example if a vehicle is not operational experience. correctly identified as being above the weight threshold for tolling, then it will not be possible to take enforcement An e-tolling system is essentially a large financial system action if the vehicle does not have a correct on-board handling large volumes of small value transactions. So unit for the higher weight class. Additionally, if a vehicle’s another main risk area is the inherent security of all aspects number plate is not clear obscured, then automatic of system design and operation to be resistant to fraud, enforcement equipment not detect the vehicle’s identity and all processes must be designed and operated within at all. Manual verification of images is used in most clear security policies. All elements of the supply chain systems in order to overcome some of the limitations of such as the provision of on-board equipment to users, automatic enforcement technology. The key is to have and the calculation and declaration of charges should a good enough system and good enough coverage to be carried out within controlled processes where losses act as a deterrent – 100% capture is neither possible or a from the system can be detected and prevented. realistic aspiration. 39 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability How to ensure adequate whole life maintenance and amount handled, the number of users they manage and support? possibly a fixed fee. The detail of this compensation mix needs to be determined at the next Stage. Adequate whole life maintenance and support is best achieved by transferring the risk of equipment reliability In all previous major tolling procurements, governments and replacement to the Contractor. This ensures that have chosen to outsource the entire system – including responsibility for keeping the system (hardware, software design, build, test, operation, and maintenance to a single and services) running lies with an organization that is contractor, so this model is well understood in the market. directly penalized in the case when a failure occurs. Only in Austria is the operation carried out directly by a There will be no possibility for the Contractor to raise a government department, although it has long established dispute that for example Government has not repaired expertise in the technical areas. Even in Austria, the faulty equipment and that it is not possible to achieve original contract to design, build, and operate the system performance requirements for toll collection. If the was let to a single private company and only once the Contractor is also responsible for the design and selection system was successfully operating did government of equipment and software for the system, the contractor choose to buy-out the operation of the system. will also be motivated to ‘design-out’ failure modes thereby increasing the long-term reliability of the system. So overall, the most important role of government in an This also means that the Contractor will be able to save e-tolling system is that of an intelligent ‘customer’. This costs of ongoing maintenance by making good decisions means that the government department or public side during design and procurement process. organization such as the SPE is focused on the Contractor who then takes on the responsibility for detailed design of However, failures will inevitably occur so the system the system, installation and its subsequent maintenance should also be designed to be fault tolerant and to ensure and operation. So the skill sets required by the public side that it can be easily maintained. The Contractor should are associated with appointing a suitable organization put in place maintenance contracts that have service to deliver the system – and the ongoing revenue levels written into them to ensure that the required from the system as well as enforcement and public level of equipment availability is achieved. The service communications. level requirements should be determined to reflect the economic consequences of a failure occurring and Whilst the Contractor would be responsible for installation revenue being lost. The penalty on the Contractor for not of procurement and installation of roadside equipment maintaining the system in accordance with requirements needed for the system, a Government body such as should reflect the damages incurred by Government in RIA would be responsible for ensuring access for the terms of lost toll revenue and other costs. Contractor to install equipment at suitable roadside locations. Site surveys would be carried out by the What activities does Government wish to be involved Contractor who would take responsibility for the quality in implementation/operation? of the complete installation until handed over to government. In deliverable 1, it was shown that the skill sets required to design, install, maintain and initially operate an e-tolling Government will need therefore to build an organization or e-vignette are unlikely to exist within Bulgarian or any with skills in managing a large prime contract using other government organization due to the specialized service levels and performance indicators for all key nature of the systems. Therefore, procurement of a operational processes. This organization will need to be Contractor will be required. supported by technical and financial experts with deep knowledge and experience of how to manage the risks. This Contractor will be responsible for the quality of the complete system until handed over to the Government at Resources from RIA will be required to facilitate the the end of the contract. The Contractor will also operate roadside work of the Contractor during installation of tolling functions as described in section 2 and operate a equipment. However, since the Contractor is responsible Service Provider function for some categories of users to for the quality of the system and its operation, the ensure that all categories of users are able to obtain an Contractor should be responsible for ensuring work on-board unit and obtain a contract. The Contractor will is carried out to necessary standards. Any specific also operate the e-vignette service. All revenue is passed requirements need to be communicated to the Contractor to government and not retained by the Contractor. The before the tender is submitted as any requirements which Contractor is paid on the basis of a monthly service charge are communicated to the Contractor after the initial adjusted in accordance with performance indicators. As technical specifications are issued may result in additional shown in deliverable 1 this may be a mix of the transaction costs. 40 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability To minimize the opportunity for costs to increase • Additionally the organisation will need to have access during the contract, the Contract should be based to specific technical expertise in at least the following around output-based specifications rather than detailed technical areas: requirements. The Contractor should decide what it Wide area telecommunications –  needs to install where in order to deliver the service. Government, for example RIA, should decide and  lectronic payment systems technologies and – E communicate what safety standards should apply to peripherals roadside installations and cyber security standards. The Testing / System verification &Validation – standards needed for IT and e-commerce in Bulgaria System monitoring –  were defined in section 10.7 of deliverable 1 which calls up a suite of standards from the Government  utomotive standards for in-vehicle equipment – A interoperability website. Section 4.5.5.covered legal installation and fleet management applications requirements.  tatistical process control and “big data” approaches – S Also the communications with stakeholders and the to analysis public are often an area Government will lead, typically  ata center service provision and database – D due to the political impacts of the project and need for management Ministers to be seen to be in control. And where the Toll Cyber security processes, standards and Audit –  Charger is also a government body, it is usual for the public side to be actively involved in the receipt of toll Vehicle classification equipment and ANPR –  revenues and reconciliation of toll transactions and toll Geographic Information Systems –  payments. Site surveying –   oadside structures design, installation and – R What type of technical competences and experience maintenance requirements are needed? Environmental assessment requirements –  Most of the technical competences are readily found Traffic operations and safety – within private contractors whose business is the design, installation, and operation of electronic toll collection Traffic surveys and modelling – systems. The necessary core skill sets that the Contractor must have include: • Programme and Project management B Functional Architecture • Quality Assurance / Supply chain quality management Background • Ability to provide sustained funding over a period In Deliverable 1, the system that will be required in of 1 – 2 years for a large IT system development and Bulgaria was shown to have two sets of functions, implementation project requiring a large negative cash those associated with the role of Government, and flow; those associated with the role of the Service Provider in collecting tolls. • Core organisational technical understanding of the functions and operations associated with an electronic toll This section is a more detailed description of how collection back office system the functions that have to be performed are to be implemented in the system. In later sections, we then • Core organisational technical understanding of required describe the organisational aspects and in particular the on-board equipment including testing and service during interfaces with the envisaged different types of Service operation across a large volume of equipped vehicles Providers. • Ability to procure and manage customer service facilities The functions that will be carried out by the system will for the distribution of on-board units in partnership with include: relevant commercial fleet services and retail organisations, and provide limited customer support and help desk • Operational functions (carried out in the back office) themselves • Commercial functions (carried out in the back office) • Management of large volume logistics and distribution • Enforcement (partly carried out in the back office services and warehousing but also partly at the roadside and by the Enforcement • Public relations and marketing in a government services Agency/Agencies, both at the roadside and in back office environment processes) 41 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability • Support functions (required to support the operation of • Management of on-board unit status and logistical the system) information • Other functions (not directly related to system • Provision of statistical and KPI reports to Government, as operation) part of a flexible Management Information System Note that a subset of these functions is required for the For the e-vignette, functions are reduced because users operation of the e-vignette. As the e-vignette and e-tolling are not charged a distance-based charge. Only the should be implemented as part of the same contract, the Contractor would offer the e-vignette to users as the functions required for the e-vignette are not described business case for independent service providers would separately but a commentary is added in the following not be attractive. text where appropriate. Enforcement Functions These different categories of functions and the main interfaces are considered further below. Enforcement functions include: • On-board unit checking (roadside and mobile units) Operational Functions • Mobile Enforcement Unit command, control and The main operational functions revolve around the despatch (back office) management of tolling transactions. • Vehicle registration checking v database (mobile units Pre-billing functions are performed during which and back office) transaction data received from on-board units or service • Vehicle class checking (mobile units and back office) providers are ‘rated’ for billing purposes and then passed to • Manual checking of evidential records (back office) the relevant Service Provider in order to carry out invoicing and downstream payment-related functions. Support Functions In the back office of the tolling system, lists are kept of Common to the delivery of all processes in the system are on-board units for which the EP or NSP has notified as support functions. These include: not having a valid payment method / account. These are updated with information from the relevant Service • A central on-line store of all transaction data, customer Provider concerning on-board units which are no longer and other data needed in real time associated with valid means of payment / account, or • A deep data and report archive used to store historic which may be likely to commit a payment violation. data and to generate offline statistical reports as part For the e-vignette, the processes involved are slightly of a flexible Management Information System. Typically different in that there is no transaction rating process many toll systems provide a suite of predefined reports / involved since the charge is a flat rate. The enforcement dashboards and a data warehouse that allows access to processes are also slightly different since they rely on data using big data approaches/, lists of valid payments, as opposed to non-valid ones. If a • A geographic database containing all position attributed user is detected at a roadside enforcement station as not data connected with system and road network assets. This being on a “valid” list then the user’s details are forwarded may use the data in the existing RIA database. (together with necessary photographic evidence) to • System monitoring functions providing on-line and enforcement processes. historic information about faults, maintenance and operations management data, and continuous system Commercial Functions performance monitoring (KPIs / SLAs) The Contractor undertakes rating of toll transactions. The following commercial functions will be carried out C Operational Model by the Service Provider: Overview • Invoicing & Toll Payment Collection – generation of Chapter 2 of this Deliverable discussed the Institutional/ invoices or toll statements for issue to users / customers Organisational model – namely who is responsible for and reconciliation of payments deducted from pre-pay doing what. This section discusses in more detail how accounts or received later from post-pay accounts. some key processes are carried out. Not all operational • Customer Relationship Management (CRM) – including processes in the e-tolling/e-vignette system are a web portal for customer account management and discussed here – only those which are particularly information provision complex or which have a bearing on policy decisions. 42 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Since many processes span many entities they are The pre-billing information provided includes sufficient grouped below into tolling and enforcement. information to be able to calculate the toll due. Therefore this information must include the charged objects which Tolling Processes each user has passed, the weight class of the vehicle and emission class of the vehicle. End to end process for defining “charge objects”, measuring them, and publishing in a GIS End to end process for electronic toll charging – TPs Government is responsible for defining “charged objects” For Toll Data Providers (TPs), the Contractor carries out the within the road network. These uniquely identify toll charging process. The Contractor issues the invoice locations used to calculate tolls. They are published in a directly to the user for tolls due based on information geo-referenced file format which Service Providers can received from the user’s nominated TP. The information encode into their on-board equipment to facilitate correct received from the TP is similar to that received from a detection of the vehicle. Service Provider but the TP does not include tolls in the user’s invoice for service provision for fleet management Process of User Registration and issuing of OBUs (if they wish to do this they must be a Service Provider). This is part of Service Provision to users. Service Providers A separate invoice is issued by the Contractor who also will require users to confirm their method of payment collects payment from each user. (bank account / credit / debit / fuel card details) and the class of vehicle for which they require to pay tolls. It is the End to end process for e-vignettes and route passes user’s responsibility to confirm and/or provide evidence of the correct vehicle class at the time of opening an Service Providers are not involved in the sale of e-vignettes account. The class of vehicle for which the user has or route passes. The Contractor will provide at least a call registered will be clearly indicated by the Service Provider. center and website for purchase for e-vignettes. They may also use apps, such as RIA’s LIMA app and other methods Service Providers will distribute on-board units to users by of payment that may develop in the future. post or through service or distribution centers. On-board units should be easily installed by users to avoid the need For a route pass, the user is responsible for declaring for users to remove their vehicle from service whilst the details of the intended journey. Payment will be made by unit is fitted. the user at the time of booking. Payment may be made by the user by credit or debit card, or by fuel or fleet card or in A special process may be operated by the Contractor some specific circumstances cash (eg at post offices). for issuing on-board units to users which are not accommodated by any other Service Provider. This will In addition, route passes may be purchased at terminals involve a user setting up an account directly with the provided by the Contractor at convenient locations such Contractor. This may be a pre-pay account in which case a as service stations and border points. When booking minimum deposit maybe required. On-board units issued an e-vignette or route pass, the user is asked to confirm by the Contractor in this Service Provider role may remain details of the vehicle to identify the toll tariff rate that the property of the Contractor. should apply. End to end process for electronic toll charging – NSPs Enforcement Processes and EPs Identifying a potential violation For EETS Providers and National Service Providers providing accounts to users, the process of charging is The diagram below illustrates the steps which the system split between the Contractor and the Service Provider. goes through to establish whether a potential violation has taken place. Depending on the Contractor’s system, The Contractor receives a toll declaration from the these may take place at the roadside or in the back office Service Provider, which includes pre-billing information or both. The details of this process also depend on: describing the user’s travel on tolled roads. The Contractor invoices the Service Provider for travel during • The vehicle classification system being used (see the billing period for all users who have accounts. The section 2) Service Provider then pays the tolls due. The Service • The access the Contractor has to the vehicle registration Provider then invoices each user for the amounts billed database by the Contractor and collects the payment from each user, along with an account fee. The steps in this process are discussed below the diagram.. 43 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Figure 7. Evidence Capture Summary Vehicle travels on toll road Does Vehicle Have Yes valid e -vignette or route pass? No Is on- board unit No detected? Yes Is on- board unit in No correct vehicle? Yes Does vehicle have No valid contract? Yes Does declared vehicle Yes class match detected No vehicle class? No violation Violation Vehicle passes an enforcement gantry – evidence with any on-board equipment and the data obtained capture from any such transaction is recorded (see below). The number plate image is read to establish the vehicle When a vehicle passes under an enforcement gantry or registration number automatically and can be manually passes by a Mobile Enforcement Unit, its image is taken checked later. (including its number plate) and classification equipment MEUs typically are not equipped with vehicle establishes its approximate size (which approximates to classification equipment and therefore would be unable its weight) and whether it is towing a trailer. If the gantry to detect some offences (those involving towing of or MEU is equipped with DSRC equipment if so chosen trailers or discrepancies in vehicle weight) and therefore by the Contractor, it may attempt to communicate the details of the process may vary. 44 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Establishing whether a vehicle has a valid e-vignette attempted communication may fail at random. Since the or route pass Administrative Violations and Sanctions Act (AVSA) requires 100% certainty that a violation has taken place, the An e-vignette or route pass is a simply an entry in a absence of a transaction from a vehicle which should have database that a vehicle with a given registration number a DSRC-equipped OBU cannot be taken as establishing the has paid for the right to use certain roads during a absence of such an OBU. specified period. For an e-vignette it is the unlimited right to use all toll roads during a given day, week, month or So where there is no DSRC transaction, the Contractor will year. For a route pass, it is the right to use a single defined have to check the time and location of the vehicle passage route once within the validity of the route pass. against the location data that he has received. Since the Contractor will have to put in place such checks in any The registration number of the vehicle is checked against case, he may decide that installing DSRC equipment may this database to see if that vehicle has the right to be on the relevant road at the time the vehicle passed the not be worthwhile and that all checking for the presence enforcement point. of on-board units will be done against location data. Conversely, he may decide that filtering out non-violations Since a route pass is a single use permit, the system notes as early as possible and thus reducing the load makes the first passage so that subsequent passages will not installing DSRC equipment worthwhile. This is a design count as having a valid route pass. decision on the part of the Contractor. The system should allow for the purchase of an e-vignette On-board units have programmed into them the or route pass up to the end of the day after the day on registration mark of the vehicle to which they are assigned. which travel first took place – i.e. a 24 hour grace period. If this is implemented, then once the system detects that To make effective enforcement possible, legislation the vehicle has no e-vignette or route pass, it suspends should be passed making it an offence to use an OBU processing of that passage to allow time for the elapse in a vehicle to which it was not assigned. of this grace period. At the end of this time, the database is checked again and if no e-vignette or route pass has If this were not the case, then it would be open to a user to been purchased the passage is treated as a violation. This argue that he was using someone else’s OBU. If this could is a customer-friendly approach especially in the early not be disproved, then under AVSA, since there was not days of operation and for very irregular users. It protects 100% certainty, then no penalty could be imposed. Government reputation, eg if a user receives a penalty for not buying a vignette to visit a hospital in an emergency, Establishing whether the vehicle has the correct on- and reduces costs of enforcement. board unit If a DSRC transaction is recorded, one item of data Establishing whether a vehicle has a functioning on- obtained from the OBU is the vehicle registration mark board unit of the vehicle. The system compares this to the vehicle Many, but not all, on-board units have a DSRC module registration mark read from the photograph taken by the in them. In a GNSS-based tolling system, such as the gantry or MEU. proposed Bulgarian one, this DSRC module is not used for toll charging but can be used to establish whether the Establishing whether the vehicle has a valid contract vehicle has a functioning on-board unit. Q-Free have now announced a combination mobile phone and DRSC tag As indicated in section 2, NSPs, EPs, and TPs provide the that also provides this use. If the Contractor has chosen Contractor with lists of OBUs and vehicles which for one to install DSRC equipment on the enforcement gantry or reason or another are invalid. If a DSRC transaction is in the MEU this equipment will attempt to communicate recorded, then the OBU identification can be checked with any on-board unit. If a response is received, then it is against this to see if the vehicle is driving with an invalid known that there is a functioning on-board unit present OBU. Alternatively the vehicle registration can be checked and the system can proceed to the next step. against the list. However, the converse is not true – if there is no Establishing whether the vehicle’s declared vehicle response, this does not mean that there is no on-board class matches the actual vehicle class unit present. The on-board unit may not be equipped with a DSRC module (e.g. OBUs provided by TPs). Even Most aspects of a vehicle’s declared vehicle class are for OBUs equipped with DSRC modules there is a small programmed into the OBU. However, variable aspects of but not zero possibility (approx. 1 in 1 million) that the the vehicle’s class have to be set by the user. In particular, 45 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability the user must enter whether he is towing a trailer, in again this can be taken into account in creating and accordance with the vehicle classification rules. For route validating future Evidential Records. passes and e-vignettes, the vehicle class is declared at the In addition, as the Contractor and Enforcement Body time of purchase. gain experience it may be necessary to change processes If a DSRC transaction takes place between vehicle and or change aspects of the law, which may have an enforcement gantry or between vehicle and MEU, the impact on processes. The tender specification for the declared vehicle class is transmitted to it. Alternatively, the procurement of the Contractor should allow for such declared vehicle class is transmitted to the NSP, EP or TP changes. and then to the Contractor along with the location data. This declared vehicle class is compared to the vehicle’s Enforcement of EETS Users actual vehicle class. The enforcement of EETS Users does not differ from As discussed in Chapter 2, how the vehicle class is checked that of other users. Although an EP guarantees the tolls is highly dependent on the vehicle classification system incurred by his user, he does so only provided that the adopted. user is behaving in accordance with requirements and so long as the EP has not placed the user on a list of Validating the Evidential Record non-valid users. Clearly accusing someone of a violation is serious and • If an EETS user has been placed on a list, then the EP has therefore there must be no errors in the Evidential Record disclaimed responsibility for him. In effect, he is no longer passed to the enforcement body. An Evidential Record an EETS user. Therefore, unless he has made alternative which has been created is therefore subject to additional arrangements (e.g. purchased a route pass), checks such as: he is committing a violation • The read of the number plate is verified by a human • If an EETS user shields or disconnects his OBU, then he operator is travelling in breach of the EP’s terms and conditions and in breach of the legal requirement to have a valid • The vehicle class of the vehicle is verified either by means of payment (unless he has purchased a route checks against the vehicle registration database, if access pass) is available, or manually by operators where possible. This is particularly important at weight class boundaries. • If an EETS user misdeclares his vehicle class, then again Vehicle classification systems are unable to precisely he is travelling in breach of his obligation to correctly pay determine the MPGVW of a vehicle. Thus around a weight tolls boundary (e.g. 3.5 tonnes, 12 tonnes) they will err on the In each case, the enforcement systems and processes side of caution and create an Evidential Record for any should detect the violation. The process of issuing a vehicle which may be above the boundary while declaring penalty will be identical to that for other users – the itself to be below the boundary. The vehicle registration penalty is sent to the owner, not to the EP. Note however database will give a definitive answer but where not that in accordance with the EETS Decision, the EP is available experienced human operators are in many cases required to cooperate with the TC in the TC’s enforcement able to identify subtle differences in vehicle characteristics efforts. If the enforcement body is aware that the user is to identify the correct weight class. Where the weight class or was a customer of a given EP (mechanisms exists for cannot be identified, the Evidential Record is passed on to checking this) then the enforcement body can request the enforcement agency for its validation and decision (via the Contractor) information about the user (e.g.name • Whether a vehicle which has been identified as towing a and address) which may assist in establishing the owner trailer without declaring so it is verified by human operator of the vehicle. Note however that the user is not as automatic systems can make errors. necessarily the vehicle owner. If the validation process detects an error then the Evidential Record is either discarded or reprocessed depending on the error detected. The process of creating Evidential Records and validating them is continually adjusted over time. In particular feedback from the enforcement agency that a vehicle is exempt or that the vehicle is not of the class identified in the Evidential Record is recorded so that if the same vehicle is detected 46 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability D Main External Interfaces The main interfaces to the system are illustrated in the diagram below. Figure 8. Main External Interfaces On-board units • National Service Providers (OBU issuers): back office interface in accordance with ISO 12855. For those on-board units that are directly provided by the Contractor there will be an interface to the e-tolling (or • Fleet Management Providers / Toll Data Providers: ETC) system. Note that on-board units provided by EETS according to agreed specifications. Note that it is Providers and NSPs do not communicate directly with the expected that not all such telematics providers will Contractor but toll data is passed to via an interface (see have implemented an interface in accordance with below under Service Provider systems) ISO12855. However, where possible the standard should be adopted in order to minimise the variation of interface Payment clearing system specifications supported. The Contractor will have an interface to an external These will need to be tested to ensure interoperability. payment clearing system which passes details of all payments received from the various payment channels. Enforcement interfaces The Contractor uses this to reconcile payments received Interfaces also exist to the following against tolls declared and payments made. This is generally a commercial off the shelf system or service • Mobile enforcement equipment – operated by the providing financial clearing functions. Contractor in partnership with the enforcement agency • Roadside enforcement equipment – provides image Service Provider systems and other data e.g. vehicle class, on-board unit ID, vehicle The Contractor’s system will need to have several defined registration number, pertaining to potential violators and proven interfaces to: detected • EETS Provider(s): back office interface in accordance with • Manual Image Verification system – used to manually ISO 12855. verify the correct class and identity of vehicles 47 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability pre-selected as potential violation cases using roadside section) will require highly reliable violation data from the equipment. system. The enforcement body will also need to manage the violation data it receives and to manage the issuing As these interfaces are between equipment operated by of penalty notices. It will need to handle private the Contractor, they are not external interfaces from an information about users’ names and addresses and organisational point of view. whereabouts and therefore will be subject to EU regulations in relation to data privacy. These will be Vehicle Registration / Licensing Database specified in the Tender Documents and were outlined in The Contractor will need to check the correct identity deliverable 1 section 4.1.1 of vehicles detected as possible violators. Note that this interface should if possible be automated and due Monitoring / Audit body interface to the volume of potential requests for information it Consideration will need to be given to what data maybe should not be a manual process – particularly in the required by any independent government audit body or case of e-vignettes. Access to foreign vehicle registration contractor for example to verify the correctness of operation databases via EUCARIS will be required. of the system or correctness of reports provided by the system. Such bodies may require unfettered access to Bank specific data generated by the system and this may involve Another external interface is with the bank into which the extraction and manipulation of large amounts of data toll revenues are paid. The system will need to keep track which can place an operational load on the system. automatically of all payments made to the bank and to be able to reconcile these payments with billing details Customs generated in respect of toll transactions. This interface An interface should be established between the system adds the requirement for the system to connect directly and the IT system of the Customs Agency. This interface is to the bank to receive and process payments and refunds. required to allow exchange of information for: Also, holding accounts may be required for pre-payment accounts. • control over road fees (vignettes) and licensing/entry permit regimes should this be needed (see Annex C) Financial Reporting System • tracking the routes of vehicles transporting excisable The toll revenue generated will be reported electronically goods, without the need to force vehicles to stop and this information can be sent directly to the In the case of vehicles paying via the e-tolling system, Government financial systems electronically if required. non-payment becomes part of the overall enforcement There will be a large quantity of data to analyze and it regime. In the case of goods tracking, additional reports will be important to consider requirements for financial will be required to filter journey information related to reporting. This data will also include information about specific vehicles declaring such cargoes based deposits received, refunds made, reconciliation of on information from the Customs system. Similar payments by users with toll transactions, missing toll interfaces can be considered for the Police and other payments, and penalty payments received in respect of appropriate agencies such as the Executive Agency violations. for vehicles. Traffic data portal Other Interfaces The system will collect statistical data regarding the traffic. Other government departments may require information An external interface for example in the form of a web for specific purposes and this information will be provided service should be provided so that relevant data can be by manual exports from historic data. used by Government and other agencies for planning and other purposes. The use of “zero toll” segments outside of the tolled class roads (eg non RIA roads) allows extra data to be collected using the system to identify diversions etc. E Summary of the models It also allows easy “turning on” of tolls on key roads used as User View “rat runs”. The diagram below summarizes the detail shown in the various technical and operational models in this section. Enforcement body It shows the wide variety of payment means, shared Whichever body is responsible for enforcement and enforcement approach, and focus on foreign users, as well issuing penalties to violators (as shown in the previous as flexibility for future technology. 48 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Figure 9. User Model 4 Legal Model A Overview • Road Traffic Act • Ordinance No-160 This section meets the TOR requirement 2.6 Development of a legal model for the development Changes Required to permit e-tolling and e-vignettes and implementation of the system, including legal and organizational structure, contractual relationship with the The proposed changes listed below take into account system provider and the relationship of the provider with the analysis of existing Bulgarian legislation and EU concerned agencies and institutions. legislation set out in Deliverable 1. In some cases, specific textual amendments can already be identified they are set out below. Additional detailed changes regarding B Legal Changes Required administrative procedures, funding, use of revenues etc. may also be required. Overview Legal changes need to address the following key areas: Roads Act • Amendments to permit e-tolling and e-vignettes in • Amendments to the Roads Act specifying how e-tolls principle and in the specific version proposed for Bulgaria or e-vignettes are calculated in accordance with the • Creating a Special Purpose Entity (SPE) to fulfil the Toll requirements of the Eurovignette Directive Charger role, should this approach be selected • Amendments to the Roads Act and Road Traffic Act to remove text relevant only to paper vignettes and to insert • Possible amendments to bi-lateral agreements with text relevant to the operation of the e-vignette system foreign governments to permit access to foreign vehicle databases and to enforce penalties for foreign vehicles • Change to Roads Act to permit both vignette charges and tolls to be charged simultaneously (although not for The following Acts and Ordinances will require the same class of vehicle) amendment: The following revision of Art. 10 of the Roads Act is • Roads Act suggested – “for passage along republican roads, which 49 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability are included in the Trans-European road network, as well as Secondary Legislation those that are outside of it or sections thereof, the Council of In addition to changes in primary legislation (the Roads Ministers may introduce only one of the following fees for Act and Road Traffic Act) listed above, changes are a given category of vehicle: (1) Fee for the use of the road required in secondary legislation (i.e. implementing acts), infrastructure – vignette fee; (2) Fee for distance travelled – which are the Rules for Application of the Roads Act and Toll. the following ordinances: • Amendments to the Roads Act to permit route passes as • Ordinance № No-160 of July 7, 2008 on conditions and an alternative to e-tolling using on-board equipment procedures for the collection of fees for the use of road • Changes to Roads Act so that signposting of alternate infrastructure, distance travelled, use of separate facilities routes is not required on republican roads and for special use of republican roads or parts thereof; • The Roads Act currently prohibits vignette revenues being used for new road construction. If e-tolling and • Ordinance № H-19 of December 2, 2008 on the e-vignette revenues are to be used for such construction, conditions and procedures for the release of persons appropriate amendments should be introduced to permit with 50 per cent and over reduced work capacity or type this and extent of disability, and individuals or families raising children with disabilities up to 18 years of age and until • Amendments to the Roads Act, Road Traffic Act and the completion of secondary education, but not later than Ordinance No-160 to fully transpose into Bulgarian law the 20 years of age, from the obligation to purchase vignette EETS Directive and Decision. Specific consideration must for the use of republican roads; be given to any legislative requirements to permit EETS Providers and independent National Service Providers to • Ordinance № H-20 of December 15, 2008 on the collect tolls conditions and procedures for the compensation of the value of the free vignettes, received by persons with 50 per • Detailed definition in the Roads Act of obligations of cent and over reduced work capacity or type and extent of users in an e-tolling and e-vignette system and therefore disability, and individuals or families raising children with what constitutes a violation. For example, if on-board disabilities up to 18 years of age and until the completion equipment is assigned to specific vehicles, using on-board of secondary education, but not later than 20 years of age, equipment in a vehicle other than the one to which released from the obligation to purchase vignette for the it is assigned should constitute an offence. Additional use of republican roads. violations would include mis-declaration of vehicle class • Ordinance № 104 / 20.05.2002 for the border controlling and non-payment of tolls by driving without a valid on- points board unit, route pass or e-vignette • Ordinance № 8121з-532 / 12.05.2015 on the conditions The specific provisions which need to be amended in and order for use of electronic technical means and the Roads Act are Art. 10, 10a, 10g, 10d, 10e, para 2, 10g, systems for control over the obligation for circulation of 44b, 44c. the roads; The detailed changes depend on the structure of the Road Traffic Act envisaged SPE. • Amendments to the Road Traffic Act to remove text relevant only to paper vignettes and to insert text relevant Rules for Application of the Roads Act to the operation of the e-vignette system • Amendments of references to vignette fees to refer to • Amendments to the Roads Act, Road Traffic Act and tolls and e-vignette fees Ordinance No-160 to fully transpose into Bulgarian law the EETS Directive and Decision. Specific consideration must Ordinance No-160 be given to any legislative requirements to permit EETS • Detailed (legal) description of the new tolling system. Providers and independent National Service Providers to In particular, amendments to Ordinance No-160 and the collect tolls possible adoption of a new ordinance to regulate the use • Amendment of the Road Traffic Act to introduce of automated technical means of enforcement penalties for violations of e-tolling requirements • Amendments to No-160 to ensure that classification The specific provisions which need to be amended in the of vehicles with trailers permits automatic enforcement Road Traffic Act are art. 100, para. 2, 139, para 5, art 165 whilst being compatible with requirements of EETS and seq. Directive and Decision and of Eurovignette Directive. 50 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability • Amendment of Ordinance No-160 to remove Proposals for Amendments in Ordinance(s) requirements to classify vehicles by numbers of axles In order to introduce a legal ground for the adoption of and suspension type, so as to allow for automated the necessary ordinances, a paragraph to Art. 10 of the enforcement. Roads Act may be added stating that: “The details of the • Amendment of Ordinance No-160 in respect of tolling to vignette and toll systems shall be regulated in an Ordinance be appropriate for an electronic only system rather than a of the Council of Ministers assuring the compliance of system based on manual tolling interoperability under Directive 2004/52/EC and Decision 2009/750/EC.” • Amendment of Ordinance No-160 so that on-board units used only for national tolling (and not for EETS) do The current Ordinance regarding the terms and not need to be fully interoperable procedures for toll collection for use of the road infrastructure regulates in detail the toll system. The • Amendments to the Roads Act, Road Traffic Act and greater part of text may be preserved. However the Ordinance No-160 to fully transpose into Bulgarian law the ordinance is not drafted in view of particular technical EETS Directive and Decision. Specific consideration must solutions and this represent a reason to suggest the be given to any legislative requirements to permit EETS adoption of a new ordinance. Providers (and independent National Service Providers) to collect tolls Internal technical documents may be drafted for the RIA administration in order to enumerate and explain the • Any required amendments to Ordinance No-160 standard procedure for each of the two systems. This will to reflect decisions regarding bodies responsible for depend on the functionalities of the electronic solutions enforcement put in place. Ordinances H-19 and H-20 The main structure of the ordinance in application • Technical changes so that existing discounts can be of the new system shall contain the following main applied to e-tolling and e-vignettes parts: 1. General Part – Payment obligations – separating Ordinance № 104 / 20.05.2002 on Border Crossing vignette and tolls Points 2. Vignettes • Amendment or deletion of provisions relating to 3. Tolls enforcement of (paper) vignette fee obligations a. Obligation for installation of on-board equipment b. Obligation for correctly setting up of the on-board Ordinance № 8121з-532 / 12.05.2015 Regarding equipment Electronic and Technical Means of Enforcement 4. Roads infrastructure description (may be in annex to • Amendments to describe the technical methods the ordinance) of enforcement of e-tolling and e-vignettes or if such technical means are described in other ordinances, 5. Competences of the Toll Charger and the EETS Provider any necessary amendments to synchronise the two (according to the EETS Decision every Toll Charger has to ordinances prepare and publish an EETS Domain Statement, in which he describes the general conditions for acceptance of an EETS Provider in his Toll Domain – therefore texts should Other regulate this aspect as well). • Detailed legislation in new ordinances defining e-tolling 6. Exemption and e-vignettes charges and charging rules according to types of roads and user behaviour (e.g. U-turns). If grace 7. Method of toll payment periods are adopted for e-vignettes and route passes, the 8. Validation of the payment and right for use of rules pertaining to such grace periods should be covered infrastructure here 9. Calculation of the amount of the corresponding charge • It may be necessary to introduce legislation regarding the operation of user accounts. Such legislation may need 10. Control – with possible cross references with other to cover documentation required for user registration, ordinance as for instance Ordinance for the Conditions circumstances under which accounts may be suspended, and Procedure for Control by Electronic Means of Rules for warnings to users of impending account suspensions etc. Use of Roads 51 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability 11. Replacements The stated-owned company still needs to follow the requirements of the Public Procurement Law for awarding 12. Requirements for EETS/ Service Providers (if applicable) of all works, services, and goods necessary for the 13. Sanctions implementation of the system. a. Breach of the obligation for installation of on-board The timetable for setting up a state-owned entity, equipment including the relevant legal amendments, is discussed b. Breach of the obligation of correct set-up of the in the Master Project Plan in Part 2 of this Deliverable. on-board equipment assuring the correct fee is Annex B gives a detailed table of legal changes. collected 14. Provisional provisions – regulating the transitional period for implementation. C Procurement Summary of Legal Requirements/Constraints on Changes Required to Enable the Creation of a Special Procurement Purpose Entity (if required) The main constraints on procurement are as follows: There are two options for the arrangement of a special state unit intended to manage the e-vignette and e-tolling • The organisation responsible for procurement of all necessary contracts systems, namely: • The timescales needed to run the procurement process • Vesting a special unit within the Road Infrastructure • The available budget/funding requirements for any Agency with the respective powers to manage the system; contracts entered into. or • A State-owned company (an existing example is the Public Procurement, Concession PPP State-owned Bulgarian Ports Infrastructure Company) One role of a state-owned company such as the SPE In both cases introduction of an explicit legal basis will be is taking the legal function of the Toll Charger which required. This can be done by means of an amendment to a considerable extent excludes the possibility for a to the Roads Act or by an entirely new Act. In addition, concession and PPP as discussed in Deliverable 1 section secondary (implementing) legislation will be required. 4.7.3. There is also little market appetite or supporting In the case of vesting a special unit within RIA, this would legislation so section 4.7.4 -4.7.6 of deliverable 1 require only a few amendments to the Regulation for the showed that the public procurement model is the most structure of RIA. advantageous approach. The SPE approach builds on this analysis. In the case of a state-owned company (which may be a single limited liability company or a single joint-stock The state company as public awarding entity company) the law establishing such a company, which is not a commercial company under the Commercial Act, If a state-owned SPE is created, it will undertake the stipulates its functions, activities, management, powers, function of the Toll Charger. The powers of the SPE are property, any applicable limitations, prerogatives, etc. provided for explicitly in the Act for its establishment The public entity cannot act outside of the framework and so cannot change from the activity stipulated in the defined in the act of its establishment. legislation. In any case, the SPE will fall within the meaning of an “awarding authority” and will be obliged to follow Since the implementation of the new system will in any the requirement of the PPL for awarding all of its supply, case require legal changes, as discussed above, this would construction, and service needs. not entail a separate procedure for amendments. Different Procedure under PPL Since RIA is an existing organisation, no further legal steps would be required. However, in the case of a The different procedures which can be used for newly created state-owned company, additional legal concluding public contracts are: steps would need to be undertaken, which could only • Open procedure (art. 64 – 74 PPL) be undertaken after the passage of the amendments • Procedure of negotiation with notice (art. 84 – 89 PPL) discussed above. These legal aspects are the adoption of company statutes, appointment of the Management • Competitive dialogue (art. 83a – 83h PPL) and Controlling Bodies, transfer of rights and/or funds/ Below is a short overview of the main aspects of each registered capital and registration with the Trade Registry. procedure 52 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Open Procedure Figure 10. Stages in an Open Procedure In open procedures, any interested economic Procedure of Negotiation with Notice operator may submit a tender in response to a call for Any economic operator may submit a request to competition. The following are the main stages of the participate in response to a call. The public authority open procedure: provides at the initial stage the information for qualitative The tender would be accompanied by the information selection that is requested by the contracting authority. for qualitative selection that is requested by the In the procurement documents, contracting authorities contracting authority. shall identify the subject-matter of the procurement by providing a description of their needs and the The main advantage of this procedure is that technical characteristics required of the works or services to be requirements are fixed and clear, but no modification procured. of them is possible after the decision for opening the procedure. The following are the main stages of the procedure: The procedure is not conditional upon any specific circumstances, neither is the contracting authority obliged to motivate the choice of the open procedure. Figure 12. Main Stages of Negotiation with Notice 53 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability The information provided shall be sufficiently precise to The contracting authority must substantiate in the enable economic operators to identify the nature and opening decision the choice of the procedure of scope of the procurement and decide whether to request negotiation with notice. participating in the procedure. The procedure of negotiation with notice is more There are specific conditions which must be met for complex. Therefore the procurement commission awarding a public contract by this means: members have to be well trained in order for the procedure to be assigned appropriately and according • The open procedure has been terminated because to the specific requirements of the public authority. all offers or projects do not meet the requirements announced by the contracting authority in advance (and the initially announced terms have not been substantially Competitive Dialogue changed); Competitive dialogue is a procedure whereby any • As an exception the nature of the service, delivery or of economic operator may request to participate and the the construction, or the risks related to them, do not allow contracting authority conducts a dialogue with the pre-determining of the value; candidates admitted to that procedure, with the aim of • The nature of the service does not allow sufficiently developing one or more suitable alternatives capable of exact determination of the technical specifications to meeting its requirements, and on the basis of which, the assign the procurement by the order of the open or candidates chosen are invited to tender. The following are limited procedure. the main stages of the procedure: Figure 10. Main Stages of Competitive Dialogue For the purpose of recourse to this procedure, a public The open procedure is the most common procedure contract is considered to be “particularly complex” where in Bulgaria. Competitive procedures may facilitate the the contracting authorities: application of innovative solutions. In these cases the evaluation team appointed by the awarding authority • Are not objectively able to define the technical should be very well prepared and should follow requirements, capable of satisfying their needs or precisely the mandate stemming from the decision objectives, and/or of the authority with regards to the procurement. • Are not objectively able to specify the legal and/or The timescales for the procurement are discussed financial make-up of a project. within the Master Plan in Part 2 of this Deliverable 2. Competitive dialogue is the most complex procedure. Given the time period required to establish any SPE to There is practically no experience of the Bulgarian public manage tolling operations, procurement of the system authorities with this procedure. should be started by existing agencies to avoid delay 54 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability to toll revenue collection. Overall management and • EETS Providers (EPs). These provide e-tolling services to enforcement of the system could then be taken on by users in Bulgaria and in other EU countries, using a single the SPE once it is fully established and staffed and the on-board unit and account for all countries technical infrastructure is installed, tested and in an • Toll Data Providers (TPs). These only provide location operational state. data and do not provide a full Service Provider service to The required financing for the project is dependent partly their users. The location data are passed to the Contractor, on the payment mechanism which will be included in who then calculates the toll due. Claims for the tolls the contracts that are entered into. For example, stage due are then passed to the NSPs or EPs for payment and payments to the main Contractor may be considered on collection from users. Tolls incurred by users of TPs are completion of stages such as design, testing, installation, collected directly from those users by the Contactor and commissioning of infrastructure. These stage (see below). payments would require a budget for lump sum payments • Possibly, an Independent Monitoring Audit Contractor to be financed by the purchaser prior to any toll revenue (IMAC) being collected. The Contractor carries out no service provision functions If such a payment profile is chosen, the Government’s for users who hold contracts with an approved EP or an cash flow can be expected to be largely negative in the approved NSP. first year of the contract during installation but positive thereafter and so could be financed from short term loans. EETS Providers are not procured via a tender process. If no lump sum payments are given to the Contractor According to European Decision 2009/750/EC Toll with instead only service payments once the system is Chargers have to accept any EETS Provider that meets operational, then this negative cash flow is passed to the the requirements of becoming an EETS Provider. This Contractor who will need to include additional finance means that the process used is open and any organisation costs in his charges. In this latter case, it is suggested that meeting certain specific requirements can apply for a longer contract period could be required to provide approval to offer EETS services. an optimal period for the amortization of capital costs. NSPs can be procured by a tender process but it is likely The financial model (Part 3) looks at the cost of this that a similar process would need to be followed as for money by having a conservative 7% discount rate for NPV EETS Providers as the requirements are likely to be very generation. similar so: • The number of NSPs and EPs should not be limited Proposal • All EPs should receive the same contract terms and Government shall appoint a Contractor to carry out all reimbursement rate from Government tolling service functions and to co-ordinate the collection of toll payments from EETS Providers and other Service TPs all have the same terms and conditions of contract Providers. The Contractor will also carry out Service and remuneration rate, although these will be different Provision functions for some users (see below). from those of EPs and NSPs, since TPs perform fewer functions. As with EPs and NSPs, any organisation In addition to appointing a Contractor, Government shall meeting basic requirements can apply to become a TP, also enter into the following other Contracts: so the number should not be limited and the • National Service Providers (NSPs). These provide e-tolling appointment of TPs would follow a very similar model services to users only in Bulgaria to that for NSPs and EPS. 55 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability 5 Interoperability A Overview known potential EETS Providers. These can extend their service to cover additional member states by engaging Background local partners or establishing their own customer service This section meets the TOR requirement 2.10 for networks. Once they are aware of the proposed e-tolling system, they will probably publicize it directly to their Development of a plan to ensure interoperability with other customers. They may also choose to market their services Member States having a system of electronic toll collection, more widely within Bulgaria, for example via the Bulgarian within three years for vehicles over 3.5 tons and five years for road haulage associations. all other vehicles after the decision on the introduction of EETS in accordance with Directive 2004/52 / EC on interoperability Therefore, involving potential EETS Providers is as an of electronic road toll systems in the Community. integral part of launching the e-tolling system. Using their marketing channels and skills will enable effective The obligations of the Decision are actually immediate so ongoing public relations and marketing activity. as soon as Bulgaria introduces an electronic toll collection system, the provisions of the EETS Decision should be The Main Steps Required to Introduce EETS Providers: implemented. The first step is to initiate the implementation of the This part of the deliverable sets out an action plan for e-tolling system as without a clear decision from implementation of EETS services in Bulgaria. Note that government there will be no appetite from EETS Providers for this section, the term ‘Toll Charger’ has a specific to plan to launch their services in Bulgaria. Legislation meaning when discussing EETS defined in the European should clearly define the opportunity for EETS Providers Decision 2009/750/EC and refers to the public or private allowing them to assess the market. organization which levies tolls in an EETS domain. Investments are necessary by EETS Providers to set up It considers the current state of the market and identifies sales channels within Bulgaria, either establishing a practical solutions to achieve interoperability starting at partnership with a local provider or by setting up their regional level. It identifies actions for involvement of EETS own local operation. An EETS Provider must also invest in Providers and sets out a plan for achieving engagement testing its on-board units and back office interface and for EETS implementation delivered at reasonable cost. processes, and negotiating the service contract. Recommendations are provided for interoperability The European Decision 2009/750/EC obliges Toll management within Bulgaria taking into account the Chargers (the Bulgarian Government) to ‘accept on a findings of the REETS project (www.reets.eu). non-discriminatory basis any EETS Provider requesting to provide EETS on the EETS domain(s) under the Toll EETS in Bulgaria Charger’s responsibility’. This means Government is obliged to offer the same commercial terms to every Firstly, four key high level questions are considered as EETS Provider that meets basic requirements. Therefore, follows: a key step is for Government is to develop a contract and How will EETS Providers be engaged in the process? commercial model acceptable for every EETS Provider. Further to the obligations in the EETS Decision it will be During the REETS project, there has been discussion important to engage EETS Providers as: about what contract terms should be included and what commercial terms would / would not be acceptable. • Heavy vehicle operators may already have toll payment One concern is the level of guarantee required. Therefore, accounts with emerging EETS Providers and therefore it consideration should be given to what level of guarantee will be convenient to pay tolls in Bulgaria through the will be required by Government from the EETS Provider to same account provide the necessary guarantee for the tolls handled by • EETS Providers will provide interoperable on-board units the EETS Provider. which can be used in many countries in the EU • EETS Providers will provide an efficient and effective Description of Interoperability Management Tasks way of enabling users to pay tolls and reduce the need to Seamless interoperable tolling across road networks with manage customer account payments different operators requires management processes and The process for engaging EETS Providers can be initiated technical standards. Countries and regions which have by providing details of the proposed e-tolling system to successfully implemented interoperability have introduced strong mandatory requirements for service provision. 56 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability In France, ASFA has created the TIS-PL service for heavy In addition the Ministry, as representative for the vehicles and the Liber-T system for light vehicles. Both are Member State, should appoint a conciliation body for built on a framework of technical standards which all Toll Bulgaria in accordance with the requirements of the Chargers in France support. Similar requirements exist in Decision. Ireland and across Scandinavia (Easy Go). If multiple Toll Chargers were to exist in Bulgaria (eg for new private roads or concession motorways) then it would B Interoperability Plan be necessary to consider how a framework to achieve Background to EETS Market national level interoperability could be established. In 2009, the European Commission issued Decision At the European level, Interoperability Management is 2009/750/EC which placed obligations on all stakeholders also foreseen to ensure that services established in one involved in achieving interoperability of e-tolling systems Member State are compatible with those established across the EU. Since then, progress towards European wide in another. The REETS project has identified tasks which interoperability has been slow. should be addressed at European level and these therefore require the active participation of all Member States. REETS Currently, interoperability only exists in some areas. has also examined what institutions could be responsible Spain has made efforts at achieving cross-border for such tasks at European level, and concluded that interoperability for example, in the Basque and Catalan existing bodies are best placed i.e. the European regions. Scandinavia has created the ‘Easy Go’ region which Commission Committee on Interoperability of Electronic includes Norwegian, Danish, Swedish, and now Austrian Toll Collection, the Coordination Group of Notified Toll Chargers. ASFiNAG in Austria has also achieved partial Bodies, Conciliation Bodies, and standardisation bodies. interoperability with Germany although two separate user REETS has identified five broad areas for interoperability contracts and invoices are required. management work at European level: Poland has installed a DSRC infrastructure nationally which • Contractual aspects complies fully with ISO 15509 and has implemented • Legal Framework functionality which allows on-board equipment to be • Information Exchange identified. • Technical Framework However, throughout the EU, Service Providers have not • KPIs been very keen to register as EETS Providers. This is partly due to hesitancy arising from the obligation on EETS Recommendations for Roles and Responsibilities for Providers to obtain approval in all European toll domains Interoperability Management within Bulgaria. within 24 months of registering. This has been perceived Assuming that there are no roads, bridges or tunnels for as an unmanageable risk because registration could which tolls are collected separately and electronically, be potentially withdrawn if this requirement was not then there will be only one Toll Charger and a single achieved. toll domain within Bulgaria. This means that the Two different tolling technologies are allowed by the interoperability framework at national level can be defined Directive. This means that EETS on-board equipment by Government as the sole Toll Charger foreseen as must support both GNSS and DSRC tolling. Therefore introducing e-tolling in Bulgaria. on-board units which have been introduced being This means that Government can define technical and either GNSS or DSRC but not both, are not suitable for contractual requirements for Service Providers without EETS. EETS Providers must invest in suitable on-board the consensus formation process required between the equipment. Service Providers based in France were in multiple Toll Chargers that exist for example in France or principle planning this as part of the Eco tax system but Norway. Government is therefore recommended to define as this was cancelled they have not been able to establish the following: interoperability in other Member States. • Contract terms for EETS Providers All this uncertainty in the market for EETS Providers resulted in 2013 in the European Commission entering • Technical requirements for EETS Providers including into a contract with 7 member states to co-fund the suitability for use testing REETS project. The broad aim of the project was to remove • Other requirements such as those required by Article 3 uncertainties by bringing together Toll Chargers and of the European Decision 2009/750/EC. Service Providers in a low risk environment. 57 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Current/Predicted EETS Providers Situation in Neighboring Member States Currently, companies are establishing themselves as Note that Member States on trans-European network EETS Providers. These include twelve companies that are routes traversing Bulgaria are considered as well as the members of Aetis, (the Association of Electronic Toll and Member States immediately neighbouring Bulgaria. These Interoperable Services) plus Ages EETS GmbH. Ages is include the following: the current Service Provider for the EuroVignette and is • Greece. There are no EETS domains currently registered a Service Provider in the German Toll Collect system. It is for Greece. also the only company currently registered formally as an EETS Provider with the German government. The twelve • Romania. There are currently no EETS domains in members of Aetis are:: Romania. • Slovakia. There is one EETS domain in Slovakia, the • Axxès SAS. Provider of electronic toll payment services heavy vehicle toll system, for which the Toll Charger is in France. Axxes issues OBUs with both DSRC and GNSS NDS (the national highway company). There are currently technologies. no EETS Providers registered in Slovakia. However, the • DKV EURO SERVICE GmbH + Co.KG. Pan-European operator of Slovakian system has announced its interest in issuer of the DKV fuel card that can be used for toll offering toll payment services in other Member States. payments. • Czech Republic. This also has a single EETS domain – the • euroShell Deutschland GmbH & Co. KG. Pan-European heavy vehicle toll electronic collection system – but does issuer of a fuel card (euroShell Service Card) that can be not have any registered EETS Providers. However, a Service used for toll payments Provider based in the Czech Republic, W.A.G. payment solutions a.s., does plan to offer an EETS service. It already • eurotoll. Issues and manages subscription contracts for offers one payment account for its customers to pay tolls the e-tolling systems for heavy goods vehicles in most in many European Member States. European infrastructure and toll road networks. • Poland. One toll domain exists which is the national • LogPay Transport Services GmbH. A Service Provider for heavy vehicle electronic toll collection system. the heavy goods vehicle Maut system in Germany, and an There are currently no EETS Providers in Poland. issuer of fuel / toll service payment cards. However, several Service Providers have expressed interest in establishing an EETS service covering Poland. • OMV. An issuer of fuel cards for car fleets and truck fleets allowing cashless fuel payment • Austria. Austria has one EETS domain, the heavy vehicle Maut system. There are no EETS Providers registered • RESSA (Red Espanola de Servicios S.A.). A pan- or offering services in Austria. European issuer of a fuel card • Germany. Germany is unique in that there is one EETS • Telepass S.p.A. An international provider of e-tolling Provider registered there, Ages. There is one EETS services including on-board unit management. domain – the LKV Maut system. • Total Raffinage Marketing S.A. A Service Provider for Implementation Principles heavy vehicles in France, Spain, and Belgium. Also a pan- European issuer of a fuel card (Eurotrafic) that can be used The national e-tolling system in Bulgaria would be an EETS domain falling under the remit of the Interoperability for toll payments. Directive and the Decision. (Note – this assumes that there • TRAFINEO GmbH. A fleet card provider and tolling / are no separate motorway, bridge or tunnel concessions Value Added Service provider. charging separate tolls electronically within Bulgaria. If there were, these would be separate toll domains • UNION TANK Eckstein GmbH & Co.KG (UTA). Issuer and national interoperability would also have to be of fuel and service cards for commercial goods and considered). passenger transport, and operator of a Europe-wide cashless payment system. The Toll Charger for e-tolling (Government) is therefore able to define and implement the contracts between it • W.A.G. payment solutions, a.s. An independent and EETS Providers without reference to other potential issuer of fleet cards in Central & Eastern Europe offering future Toll Chargers in Bulgaria. For example, it is able to sophisticated payment solutions for passenger and freight establish the remuneration rate that EETS Providers would carriers. be paid as defined in deliverable 1 section 4.2.3. 58 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability C Member State Responsibilities additional technical complexity will result if European norms are not followed in this area. Regulatory The main EU regulations applying to e-tolling systems are: Specific Obligations at Member State Level (What Government Must Do) • Directive 2004/EC/52 on the interoperability of electronic road toll systems The following items are listed in decision (2009/750/EC) as being the responsibility of all Member States (rather • Decision 2009/750/EC on the definition of the than Toll Chargers) to enact, so these obligations must be European Electronic Toll Service and its technical enacted in legislation within Bulgaria. elements All European Member States are required to comply with Article 3. Registration of EETS Providers the Directive 2004/EC/52 by ensuring that operators of national systems offer an e-tolling service that is The EETS Decision (Decision 2009/750/EC) describes interoperable with other European services. The European the process of registration of an EETS Provider (Article 3). Commission has stated that the purpose of these This is a process under the responsibility of the Member regulations is: States. According to section (b) of this article, the Member States need to verify that EC-declarations or certificates “To achieve the interoperability of all the electronic road attesting compliance with the provisions of Annex IV (1) toll systems in the European Union in order to avoid are provided the proliferation of incompatible systems, which may compromise both the smooth operation of the internal A process should therefore be defined by Ministry which market and the achievement of transport policy objectives.” reflects the requirements a) – f ) listed in Article 3 of the Decision and allows EETS Providers to register as such Tolls applied to heavy vehicles are also regulated by within Bulgaria prior to applying to a Toll Charger to carry Directive 1999/62/EC for the use of certain infrastructures out suitability for use tests in a Toll Domain. and later amendments. This Directive reflects the ‘user pays’/‘polluter pays’ principle of internalizing external costs Article 10. Conciliation Body on the environment. There are currently no equivalent Directives applying to the charging of light vehicles. “Each Member State with at least one EETS domain shall However, the European Union may challenge schemes designate or establish a Conciliation Body….” which contravene articles within overarching European The purpose of a conciliation body is to adjudicate in cases treaties, particularly relating to non-discrimination and where disputes arise between Toll Chargers and Service personal data protection. Providers. However, conciliation bodies are currently not Non-discrimination is a fundamental right within the active in EETS so there is no practical experience of them. Charter of Fundamental Rights of the European Union and One of the tasks of the REETS project was to develop enshrined in Article 18 of the Treaty on the Functioning of guidelines on the management of interoperability the European Union. The Maastricht treaty on European between toll domains and the project will report on this Union also includes the principle of non-discrimination. topic at the end of 2015. The Irish government however, has published a set of procedures for the operation of Personal data protection is also a fundamental right the EETS conciliation process in Ireland. This has been within the Charter of Fundamental Rights of the European highlighted by the REETS project as an example which Union and is enshrined in Article 16 of the Treaty on the could be adopted for the operation of conciliation Functioning of the European Union. Relevant European processes in other countries. legislation includes: • Directive 95/46/EC on the protection of individuals with Article 17. Notified Bodies regard to the processing of personal data and on the free “Member States shall notify to the Commission and the movement of such data is also relevant to ETC systems. other Member States any bodies entitled to carry out or • Directive 2006/24/EC on the retention of data generated supervise the procedure for the assessment of conformity to or processed in connection with the provision of publicly specifications or suitability for use …..” available electronic communications services or of public The purpose of notified bodies is to provide a process for communications networks. the certification of EETS interoperability constituents. EETS Regarding vehicle categories there are no European interoperability constituents are the technical elements regulations that prescribe how toll tariffs are defined which must be compatible on both Service Provider and in terms of vehicle class, but it should be noted that Toll Charger side in order to allow correct operation to 59 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability take place. Specifically this refers to the on-board unit of • During the procurement cycle, information about the the Service Provider, roadside DSRC equipment, and the scheme should be distributed to potential EETS Providers electronic interface between the Service Provider’s back in order that they may decide whether to prepare an offer office system and the Toll Charger’s system. of services for Bulgaria. This should be done early enough to allow EETS Providers to complete suitability for use tests However, currently available technical standards are not prior to offering services in Bulgaria. Government should specific enough to allow certification by a notified body nominate a conciliation body to carry out mediation to assure operation in any toll domain. The REETS project between the Toll Charger and Service Providers in the case has been looking at this problem and has recommended where approval is disputed. a wider process of ‘technical accreditation’ which would include the specific requirements of individual toll domains. Commercial The Toll Charger should prepare general contractual Article 19. Registers conditions which can used for contracts with EETS Providers and also with other Service Providers. EETS Each Member State is required to create and publish a Providers must be accepted on a non-discriminatory register of Toll Domains. Note that the national toll scheme basis. Therefore the terms and conditions offered to EETS would be considered as a single Toll Domain, whereas roads Providers should also be non-discriminatory, and payment operated by bodies other than RIA and tolled electronically levels should be comparable if equivalent levels of service would be considered as separate Toll Domains. are provided by Service Providers. A competition could be used to obtain proposals from EETS Providers, although it is likely that contracts would need to be entered into with D Toll Charger Responsibilities comparable payment levels being given to each Service Technical Provider which is approved. Having achieved entry into the Register of EETS Providers within a Member State, the EETS Provider has the right to enter into negotiations for providing EETS in any individual E EETS Provider Responsibilities toll domain within the EC. The Toll Charger is able to General specify in its EETS domain statement, general conditions that an EETS Provider must meet. The general responsibilities of an EETS Provider concern providing the user with a service to enable tolls to be paid Article 5 paragraph 5 of the Decision says “Toll Chargers in any toll domain in the EU. This includes providing the shall accept on their EETS domains any operational on- user with an on-board unit which complies with technical board equipment from EETS Providers with whom they standards and is accepted by Toll Chargers for use in their have contractual relationships, which have been certified in toll domains. The EETS Provider must also ensure that the accordance with Annex IV.” Annex IV of the EETS Decision correct vehicle classification information is stored in the refers to ‘conformity to specifications’ and a list of the on-board equipment and that this does not need to be applicable technical specifications has been prepared by changed by the user when leaving and entering different the co-ordinating group of notified bodies. toll domains. The second part of Annex IV refers to suitability for use EETS Providers are responsible for invoicing users with testing. A procedure for testing the correct operation whom they have contracts, and for maintaining lists of the EETS Provider’s on-board equipment, back office of users for whom contracts have been invalidated, for interface and business processes in the toll domain example due to non-payment of invoices. should be established by the Toll Charger as part of the implementation of its electronic tolling system. Compliance with Standards Organisational On-board units issued for EETS services must support both GNSS/CN and DSRC based methods of charging to To implement EETS within Bulgaria the following ensure they are accepted in all other EU Member States. organisational actions are required: The on-board units must comply with the list of relevant • The Toll Charger (Government), should implement a standards for EETS and the on-board unit manufacturer process for approving prospective EETS Providers and shall have certified the on-board unit in accordance with for monitoring their performance once their service is these requirements prior to the EETS Provider being able operational. to offer services in the toll domain. 60 PART 1: Institutional Model, Technology, Legal and Procurement Issues and Interoperability Suitability for Use Testing F Summary According to the EETS Decision, EETS Providers must The implementation of EETS is a mandatory EU submit their interoperability constituents (i.e. their requirement on government as part of the introduction of on-board equipment and back office interface) to the an e-tolling system. Bulgaria has administrative obligations Toll Charger for suitability for use tests. This is generally as a Member State which are set out above, and these are done after on-board units have already been certified in separate to the obligations on government in its role as accordance with relevant European standards. Suitability Toll Charger for the e-tolling system. for use testing allows the Toll Chargers to check that the required functionality has been implemented by the EETS EETS Providers now exist and are in the process of Provider in order to allow correct charging of tolls in the obtaining approvals to offer interoperable services in toll domain. The costs of these tests are the responsibility several other European countries. Heavy vehicles will, of the EETS Provider and generally involve test driving with within the lifetime of this system, be equipped with EETS a small fleet of equipped vehicles. The Toll Charger must compatible on-board units that can be used in Bulgaria, be able to verify that users have been correctly invoiced and many trucks registered in Bulgaria will become EETS by the Service Provider for the journeys made by the test customers to use the service in other Member States, even fleet. if the service is not available in the short term in Bulgaria. 6 Next Steps Specific actions to be considered before the next steps in on access to the vehicle registration database will have procurement from this part of the deliverable are: a direct impact on who operates enforcement – a uniformed public body or a private body • Choose the body that will undertake enforcement (Police, Customs, RIA, another body such as an SPE.) This needs to be done quickly to avoid delaying the next Other key tasks are: Stages of design. If a new body is set up it can lead on all aspects of tolling operations including enforcement and • Prepare contract documents based on the institutional overseeing Contractor operations. and operational model • Choose which body will commence the procurement • Develop a communications plan with key stakeholders for the project, especially road users and hauliers, so that • Consider the changes to legislation identified in this they can prepare for the changes report to support various details of e-tolling and its procurement, and transposition into Bulgarian Law of the • Engage with Bulgarian industry, especially fleet EETS Directive and Decision management system providers, ITS Bulgaria and local companies able to be Service Providers • Look at the vehicle ownership database and possibilities for access to improve joined up data use and reduce • Engage with the international tolling industry, to prepare costs for better data sharing in Government. A decision them for the tender 7 Annexes Annex A: Data Sharing between the e-tolling/e-vignette System and External Bodies 62 Annex A: Data Sharing between the e-tolling/e-vignette System and External Bodies A.1. Introduction disabled persons). Using this strict and narrow legal definition it is unlikely that significant leaks of revenue Deliverable 1 briefly discussed the possibility of bodies will be seen as has been observed in other countries such as the Police and Customs using data from the where exemption definitions are less stringent. Exempt e-tolling / e-vignette system for other, unrelated, purposes. vehicles will be identified by their number plate from This Deliverable 2 briefly discussed how this could be either a special register of exempt users or direct from the accomplished via a separate data depository and raised registration database. the Data Protection implications of such an approach. Enforcement gantries are only located at limited points This Annex is based on discussions with representatives in the road network and MEUs can only cover other parts of the Police and Customs and discusses in more sporadically. Therefore the above method cannot provide detail how data from the e-tolling / e-vignette system comprehensive coverage. could be used operationally. It should be emphasised that further detailed discussions are required with the Method 2 services to define the requirements for data sharing. However, those vehicles which are equipped with on- These discussions must take place prior to writing the board units (OBUs) for e-tolling purposes can be tracked specifications for the tender for the Contractor – adding throughout the network, since they continually send their in requirements to a system after its implementation is location data. Each OBU is assigned to a specific vehicle always complex and costly. and in principle, that OBU should be used only in that vehicle. Thus by tracking the OBU and assuming that it is A.2. Vehicles of Special Interest (VOSI) – being correctly used, the vehicle can be tracked. Provision of Near Real Time Detection Data As with method 1, the service that has requested Frequently Police, Customs or other enforcement or notification of the VOSI can specify whether it is notified security services are seeking a particular vehicle and wish of the vehicle’s passage immediately or within, say 24 to be informed of its location when it has been detected. hours or a week. No digital image can be requested as this The e-tolling / e-vignette system can assist in two ways. method does not generate such an image. The request for notification can last until further notice or be time limited. Method 1 In summary, method 1 can detect all VOSIs but only at As set out in sections 2 and 3 of this Deliverable 2, when- limited points in the network, whilst method 2 can only ever a vehicle passes under an enforcement gantry (or track OBU equipped VOSIs but throughout the whole by an MEU), a digital image is made of the vehicle and of network. In both cases, it would be possible to pass its license plate and the vehicle’s registration number is relevant information to the Customs official at the border read from that digital image. In general, that image and all point when the vehicle arrives there. information related to the vehicle’s passage are discarded if the vehicle is not committing an e-tolling or e-vignette offence. However, if the appropriate service (e.g. the Cus- A.3. Access to Data and Images for Traffic toms Coordination Unit in Sofia) has supplied, in advance, Analysis the vehicle registration number of the vehicle of special Raw data from the ETC system could be placed in a interest to the Contractor, then the system can be pro- separate data depository, accessible by services such as grammed to retain the information regarding the vehicle’s Police, Customs Coordination unit, RIA and the security passage, including, if required, the digital image of the services. The services would then be able to perform vehicle, whether or not the vehicle is committing an e-toll- their own analyses according to their own requirements, ing or e-vignette offence. The service that has requested either via tools provided with the data repository or by notification of the VOSI can specify whether it is to be downloading data to their own systems. The use of a notified of the vehicle’s passage immediately or within, say separate data repository is primarily to ensure that access 24 hours or a week, and whether the digital image of the to these data does not have an operational impact on vehicle is also passed to the service. The request for notifi- the ETC system. It also allows data in the depository to be cation can last until further notice or be time limited. anonymised (see below). The above process applies to all vehicles, whether they An example of the use of such data would be analyses have an on-board unit or not. Thus vehicles which only of traffic patterns by Customs to identify trans-shipment use e-vignettes or route passes, which are exempt from points. Data available could include e-tolling or e-vignette obligations or which are evading such obligations can all be detected by this means. • OBU location data – dates, times and locations of OBUs Exemptions are defined in Bulgarian law (see deliverable 1 (no images would be available) annex 4) and there are very few vehicles that are exempt • Enforcement data – dates, times, locations and number (Ministry of Interior, Ambulance, Army, agricultural tractors, plates of vehicles committing e-tolling and e-vignette viola- 63 Annex A: Data Sharing between the e-tolling/e-vignette System and External Bodies tions. While enforcement data include images, it is likely that to detailed Customs checks is the route travelled. This they would have to be excluded as anonymization require- is normally obtained from the TIR / T1 document or exit ments (see below) would be negated by the use of images summary declaration. However, it could potentially be • VOSI data as discussed in A.2 above supplied from the ETC system (in detail for vehicles for OBUs, or assumed for vehicles with transit route passes, or Care must be taken to ensure that this is done without any information obtained by the ETC enforcement system violating Data Protection requirements. In particular, it is for vehicles without OBUs or route passes) as discussed in likely that data placed in the depository would need to A.4 above. be anonymised in some way (e.g. number plate ABC123 translated into XYZ245). Such anonymised data is likely to be sufficient for the purpose of traffic pattern analysis, but A.6. Auto Checking of Emissions Class for may not be sufficient for specific operational requirements ECMT Permits at Customs Check Points of the services. A detailed analysis needs to be taken as to The ECMT permit requires that the emissions class be the balance between operational requirements and data Euro III or better. At present this is checked by checking protection requirements. the vehicle’s registration documents. For vehicles with Access to the depository and the analyses carried out OBUs, the emissions class will be recorded in the OBU. would need to be tightly controlled and may need to be For vehicles with OBUs which have a DSRC element, subject to court orders. the emissions class could be automatically checked. This assumes that the vehicle registration and OBU programming process was rigorous and the data in the A.4. Oversize Vehicle Checking – Route of OBU are correct. Not all vehicles could be checked in Travel this way but this would provide some improvement in If a vehicle is over-sized or over-weight then on entry to overall efficiency. This approach does not require access Bulgaria it is charged a fee (irrespective of whether it has an to the depository of ETC data nor to the ETC operational ECMT permit or not) which is dependent on distance to be system, but would require DSRC readers to be installed travelled. Drivers declare on entry where they are travelling at Customs posts and linked to the Customs system. This and the distance to be travelled. There is clearly a tempta- would require the secure distribution of encryption keys to tion to under declare the distance to be travelled to save Customs to enable these DSRC readers to read the OBUs. the fee to be paid. For vehicles with an OBU, it is in principle possible to provide information to Customs officials, on exit A.7. Sale of ETC Route Passes/vignettes by from Bulgaria, about the route actually used and therefore Customs distance travelled to make sure that the correct fee had been paid. The proposed e-tolling / e-vignette system requires the sale of route passes and e-vignettes. Since Customs As indicated in A.3 above, data in the data repository is likely currently sells paper vignettes at entry and exit points, to be anonymised, which of course would not be useful for it would be a logical development of current practice this operational purpose. Such vehicle specific data would to involve Customs in the sale of route passes and therefore need to be obtained from the operational system, e-vignettes on entry. No sales would be made at exit, since but as indicated above, without having an impact on the any vehicles without OBUs, route passes or e-vignettes operational ETC system. would be subject to normal enforcement procedures, One approach would be to implement a variant of the VOSI which would not involve Customs. It would not be system described in A.2 above, whereby Customs at entry practical to distribute OBUs at the booth as the process is requests that all distance data for a vehicle in question be more complex and requires the installation of an OBU. accumulated until further notice and on entry requests that accumulated distance data, at the same time terminating The sale of route passes and e-vignettes by Customs the accumulation request. would require modification of the existing road fees and permits module of the Customs IT system and in For vehicles without OBUs, information obtained by the ETC particular would require real-time links to the ETC system enforcement system can be provided, to check whether this so that sales could be immediately recorded, so that such is consistent with the declared route/distance. vehicles would not be subject to enforcement action. As with other aspects of interaction between the ETC A.5. Risk Analysis by Customs for Detailed system and external agencies, this would require detailed specification and agreement at the next Stage. It is also Customs Checks influenced by the adoption of other options for foreign Part of the risk analysis undertaken by Customs at the vehicle enforcement, and the timing of the entry into the border of whether an individual vehicle should be subject Schengen area. Annex B: Legal Changes 65 Annex B: Legal Changes B.1. Description of the Identified Legal Amendments Necessary for the Implementation of the E-vignette and Toll System in Bulgaria 1. AMENDMENTS IN ROADS ACT AND ROADS TRAFFIC ACT Act/Provision Current Provision Reasons Suggested Approach Roads Act Art. 10 For passage on national roads that are This provision is the legal The new reading of the included in the Transeuropean Road basis for the collection text may be: Art. 10 (1) for Network as well as roads outside the of fees for using of passage along republican latter or on their sections the Council road infrastructure. roads, which are included of Ministers may levy only one of the The amendment is in the Trans-European road following tolls: 1. Toll; Vignette …. necessary because of network, as well as those the implementation that are outside of it or of a completely new sections thereof, the Council e-vignette and toll system. of Ministers may introduce only one of the following fees for a given category of vehicle: (1) Fee for the use of the road infrastructure – vignette fee; (2) Fee for distance travelled – Toll. A new paragraph may be added to art. 10 in the sense that: The conditions and rules for the operation of the vignette and toll system shall be regulated in an ordinance of the Council of Ministers in conformity to the requirements of Directive 1999/62/EC, Directive 2004/52/EC and Decision 2009/750/EC. Art. 10a The provision explains in detail the The amendment / A possible approach is to vignette fee payment process. revocation is necessary revoke the provision and because of the regulate the details in the implementation of ordinance of the Council of a completely new Ministers under article 10. e-vignette and toll systems. The entire article, including its 13 paragraph, need to be amended. Art. 10g The provision states that for vehicles Only synchronization is needed. The amendment is registered in a foreign country a necessary in order to clarify that the rules applies both to vignette fees shall not be collected vignette and toll fees. in case this is stipulated in an international agreement or convention. 66 Annex B: Legal Changes Act/Provision Current Provision Reasons Suggested Approach Art. 10d The provision states that vignette fees Only synchronization is needed. This text should be are not applicable for tractors, tractors' considered only in order to include that vignette and toll trailers and other vehicles used in fees are not applicable to those vehicles. agriculture. Art. 10e (1) The provision states that the control on Only synchronization is needed. This provision should be border control points of the obligation synchronized with the amendments under art. 10. to pay the fees under art. 10 RA shall be effectuated by the officer of the Customs Agency Art. 10e (2) This provision specifies that in case a Only synchronization is needed. This provision should be vehicle intends to leave the country synchronized with the amendments under art. 10 and and it does not holds a valid vignette may refer for details to the ordinance adopted by the sticker, it can leave the country only Council of Ministers under art. 10. after having paid the corresponding under art. 10a (7) fee to the specialized unit of the Customs Agency. Art. 10 g With regards to a vehicle used for Only synchronization is needed by adding the combined transport within the corresponding wording, i.e. including toll fee. meaning of Article 56 of the Railroad Transport Act no vignette toll shall be paid for its movement from the border to the nearest intermodal terminal and vice versa, if a certificate of combined internal transport on the territory of the Republic of Bulgaria has been issued according to standard form approved by the Minister of Transport, Information Technology and Communications. Art 19 (1) Roads shall be managed as follows: In case a new stated owned company is created to management the e-vignette and toll system it will be 1.National roads: by the Road precise to add the company in this provision as follows: Infrastructure Agency and by the Strategic Infrastructure Projects (1) Roads shall be managed as follows: National Company in the cases, 1. National roads: by the Road Infrastructure Agency and provided for by this Act; by the Strategic Infrastructure Projects National Company and (new Toll Company) in the cases, provided for by this Act; Art. 30 (1) The Agency shall pursue In case a new stated owned company is created to the activities pertaining to the management the e-vignette and toll system it should be construction, repair and maintenance added in a new paragraph 3 and the rest of paragraph of the national roads. shall be renumbered. (2) The Strategic Infrastructure Projects National Company shall perform the activities related to the construction, repair and maintenance of the highways under Article 28b, Paragraph 1. 67 Annex B: Legal Changes Act/Provision Current Provision Reasons Suggested Approach Art. 44b The provisions reads: This articles need to be revoked and a new one adopted regulating the budgetary aspects of the collection of the (1) The revenues collected from fees under the new system. vignette tolls under this Act shall be registered as revenues of the budget There are two suggested approaches: of the Agency. ... (3) The vignette-toll • To amend both paragraphs giving the possibilities for revenues under Article 44, Paragraph RIA to decide with certain limits on the destination of the 1, Item 2 shall not be used to finance revenues from toll fees, including the possibility to finance new road infrastructure construction new road infrastructure. • To revoke the provision and regulate the matter in a separate new chapter which treats the creation of a state owned company – as indicated below. EU Law The new provision need to be aligned with the provision of Art. 9, paragraph 2. Directive 1999/62/EC which states that “Member States shall determine the use of revenues generated by this Directive. To enable the transport network to be developed as a whole, revenues generated from infrastructure and external costs charges, or the equivalent in financial value of these revenues, should be used to benefit the transport sector, and optimise the entire transport system. In particular, revenues generated from external cost charges, or the equivalent in financial value of these revenues, should be used to make transport more sustainable, including one or more of the following: (a) facilitating efficient pricing; (b) reducing road transport pollution at source; (c) mitigating the effects of road transport pollution at source; (d) improving the CO 2 and energy performance of vehicles; (e) developing alternative infrastructure for transport users and/or expanding current capacity; (f ) supporting the trans-European transport network; (g) optimising logistics; (h) improving road safety; and (i) providing secure parking places. This paragraph shall be deemed to be applied by Member States, if they have in place and implement fiscal and financial support policies which leverage financial support to the trans-European network and which have an equivalent value of at least 15 % of the revenues generated from infrastructure and external cost charges in each Member State.” 68 Annex B: Legal Changes Act/Provision Current Provision Reasons Suggested Approach Art. 44c (1) The budget of the Agency shall plan This provision need to be synchronized with the new for and cover spending for financing institutional model. It may regulate the possibility to activities pertaining to the operation, finance new construction according to which the revenues maintenance, repair, and reconstruction from toll and e-vignette fee may be used for construction of the national roads which are subject of new roads within certain limits observing the provision to vignette tolls that shall include: ... of the Law on Public Finance and the Annual Law on State Budget. The same comment as to art. 44b applies. This chapter can be situated after chapter 4 “b” – Strategic Infrastructure Projects National Company). In case a new stated owned company is created to manage the E-vignette and Toll system the new chapter and provision may follow the structure of the preceding chapter regarding the Strategic Infrastructure Project National Company. In addition the provisions should include: financing of the company may and the essential terms of the contract between Toll Charger and Toll Operator. The essential terms may be part of the ordinance under art. 10 and only a reference to be made to that provision. While the collection of fees shall be made by the state company, including via the toll operators, the imposition and collection of fines can be left to the RIA or the SPE. In view of the above the current legal framework as to the control, imposition and collection of sanctions will not require substantive amendments (except for the amendments related to the electronic control and imposition of sanctions, as mentioned below in the third section of this working document). Roads Traffic Act Art. 100 (2) The motor vehicle driver shall adhere a This provision will be A possible amendment valid vignette sticker for a paid vignette no longer applicable. reads as follows: The fee, pursuant to Article 10, Paragraph Therefore the text should motor vehicle driver shall 1, item 1 of the Roads Act, in the lower be amended taking into carry a valid document right corner of the windshield of the account the obligations proving the payment of motor vehicle, when driving on the according to the Roads Act. the corresponding to that national roads and shall remove the It is important to clearly vehicle vignette or toll fee vignette sticker immediately after the differentiate the obligation in conformity with the expiry of its validity. to pay a vignette and toll requirement of the ordinance fee under the Roads Act under art. 10 of the Roads and the obligation to use Act. (be on the road) the road infrastructure after paying the corresponding toll or vignette fee and holding the corresponding prove – receipt, a properly installed and programmed on board unit, a route pass, etc. – for the purposes a reference to the ordinance under art. 10 of the Road Act may be given. Art. 139 (5) Driving the vehicles set forth in the Only synchronization is Driving the vehicles set forth Roads Act on national roads shall be needed. in the Roads Act on national allowed after paying a vignette fee roads shall be allowed after under the procedure of Article 10, paying the corresponding Paragraph 1, Item 1 of the Roads Act. toll or vignette fee under the Roads Act. 69 Annex B: Legal Changes Act/Provision Current Provision Reasons Suggested Approach Chapter 5 (1) Authorities designated by the Only synchronization is (1) Authorities designated (Rights and Minister of Interior: … 11. control needed. by the Minister of Interior: … Obligations whether drivers observe their obligation 11. control whether drivers of the Control to drive the vehicles on the national observe their obligation to Authorities) – roads after paying a vignette fee, drive the vehicles on the art. 165 (1), placing valid vignette stickers, and national roads after paying a p. 11 removing vignette stickers with expired vignette or toll fee; terms; Chapter 6 (Administrative measures of compulsion) Art. 171, p. 2, In order to ensure road traffic safety Only synchronization is In order to ensure road traffic letter “g” and put an end to the administrative needed by adding the safety and put an end to the violations, the following administrative corresponding wording, i.e. administrative violations, measures of compulsion shall be including toll fee. the following administrative enforced: …2. temporary prohibition measures of compulsion shall of using of a vehicle: ... g) when the be enforced: …2.temporary respective vignette fee referred to in prohibition of using of Article 10, Paragraph 1, Item 1 of the a vehicle: ... g) when the Roads Act has not been paid, or when respective vignette fee or an invalid vignette sticker has been toll fee under the Roads Act stuck; has not been paid, or has not been paid correctly; Art. 179 (3) Article 179. (1) A driver driving a vehicle An amendment of this provision is needed. The text on national roads without having depends on the technical solution put in place and the paid the vignette fee under Article 10, possibilities for the driver to prove payment. Paragraph 1, item 1 of the Roads Act, or driving a vehicle with an affixed vignette sticker with graphic design, differing from the approved one, shall be fined as follows: ... Art. 179 (4) (4) A driver driving a vehicle on national A substantive amendments of this provision is needed and roads for which the vignette fee under synchronization with article 179 (3). Article 10, Paragraph 1, item 1 of the Roads Act has been paid in amount, lower than the statutory amount for the respective category, shall be fined as follows: … B.2. Revocation and Adoption on New Art. 10 of the Roads Act can be the legal base for Implementing Provisions – Regulations adoption of such ordinance by the Council of Ministers as pointed above. and Ordinances In the second column a reference to the relevant EU The specifics of the new system can be regulated in an law is made. The information may be used for the ordinance which will substitute the current Ordinance on substantiation of the amendments according to national conditions and procedures for the collection of fees for procedure for adoption of legal acts. the use of road infrastructure, distance travelled, use of separate facilities on republican roads and for special use The ordinance would regulate the following of republican roads or parts thereof. aspects: 70 Annex B: Legal Changes Structure of the Ordinance Relevant provision for the analysis for correspondence with EU Law 1. G  eneral Part – Obligation to • Directive 1999/62/EC pay a fee for use of the road Article 7, p. 1 – Without prejudice to Article 9 paragraph 1a, Member States may infrastructure maintain or introduce tolls and/or user charges on the trans-European road network or on certain sections of that network, and on any other additional sections of their network of motorways which are not part of the trans- European road network under the conditions laid down in paragraphs 2, 3, 4 and 5 of this Article and in Articles 7a to 7k. This shall be without prejudice to the right of Member States, in compliance with the Treaty on the Functioning of the European Union, to apply tolls and/or user charges on other roads, provided that the imposition of tolls and/or user charges on such other roads does not discriminate against international traffic and does not result in the distortion of competition between operators. 2. Member States shall not impose both tolls and user charges on any given category of vehicle for the use of a single road section. However, a Member State which imposes a user charge on its network may also impose tolls for the use of bridges, tunnels and mountain passes. (…) • Directive 2004/52/EC and Decision 2009/750/EC The Directive and the Decision lay down the conditions necessary to ensure the interoperability of electronic road toll systems in the Community. It applies to the electronic collection of all types of road fees, on the entire Community road network, urban and interurban, motorways, major and minor roads, and various structures such as tunnels, bridges and ferries. The prospective ordinance should be completely synchronized with these acts. 2. Classification of the vehicles According to art. 2, letter “f” from the Directive 1999/62/EC ‘type of vehicle’ means a category into which a vehicle falls according to the number of its axles, its dimensions or weight, or other vehicle classification factors reflecting road damage, e.g. the road damage classification system set out in Annex IV, provided that the classification system used is based on vehicle characteristics which either appear in the vehicle documentation used in all Member States or are visually apparent  overed roads infrastructure – 3. C According to art. 2, letter “a” from the Directive 1999/62/EC ‘trans-European road description (may be in annex network’ means the road network defined in Section 2 of Annex I to Decision to the ordinance) – motorways, No 1692/96/EC of the European Parliament and of the Council of 23 July 1996 first-class roads, class 2 and on Community guidelines for the development of the trans-European transport class 3 roads. Signalling the network as illustrated by maps. The maps refer to the corresponding sections road infrastructure mentioned in the operative part of and/or in Annex II to that Decision  -Vignettes. Calculation of the 4. E The vignette will fall under the definition of ‘user charge’ according to art. 2, due amount and payment letter “c” from the Directive 1999/62/EC. The definition is a “specified amount methods. Validation of the payment of which confers the right for a vehicle to use for a given period the payment and right for use of infrastructures referred to in Article 7(1)” infrastructure  olls. Calculation of the 5. T According to art. 2, letter “c” of Directive 1999/62/EC ‘toll’ means a specified due amount and payment amount payable for a vehicle based on the distance travelled on a given methods. Validation of the infrastructure and on the type of the vehicle comprising an infrastructure payment and right for use of charge and/or an external-cost charge; infrastructure. 71 Annex B: Legal Changes Structure of the Ordinance Relevant provision for the analysis for correspondence with EU Law Obligation for installation 5.1.  of on-board equipment. Obligation for correctly 5.2.  Annex III to the Directive 1999/62/EC sets the core principles for the calculation setting up of the on- of the tolls. board equipment  alidation of the payment 5.3. V The technical elements witch should be observed are given in Decision and right for use of 2009/750/EC of 6 October 2009 on the definition of the European electronic toll infrastructure service and its technical elements adopted under Directive 2004/52/EC of the European Parliament and of the Council of 29 April 2004 on the interoperability of electronic road toll systems in the Community. 6. Route passes Article 7j, p. Directive 1999/62/EC states that “2. The arrangements for collecting tolls and user charges shall not, financially or otherwise, place non-regular users of the road network at an unjustified disadvantage. In particular, where a Member State collects tolls or user charges exclusively by means of a system that requires the use of a vehicle on-board unit, it shall ensure that appropriate on-board units compliant with the requirements of Directive 2004/52/EC of the European Parliament and of the Council of 29 April 2004 on the interoperability of electronic road toll systems in the Community can be obtained by all users under reasonable administrative and economic arrangements”  eplacements related to 7. R the e-vignette and tolls equipment and payments  ompetence of Roads 8. C The definitions shall be aligned with the definitions from Decision 2009/750/ Infrastructure Agency and EC – Article 2. the Stated owned company managing the (a legal base in the Roads Act will be required)  efinitions of Toll 9. D Administrator (if applicable), Toll Charger, Service providers. Obligation of the Toll Charger and EETS service providers. Competences of the Toll 9.1.  Article 5 and Article 4 of Decision 2009/750/EC. Charger and the Service Provider EETS Domain Statement 9.2.  Annex I to Decision 2009/750/EC gives the contents of an EETS Domain – rules. According to the Statement. EETS Decision every Toll Charger has to prepare and publish an EETS Domain Statement, in which he describes the general conditions for acceptance of an EETS Provider in his Toll Domain – the texts should regulate this aspect as well 72 Annex B: Legal Changes Structure of the Ordinance Relevant provision for the analysis for correspondence with EU Law  egistration process for EETS 10. R Article 3 (4) of Directive 2004/52/EC provides that Member states having Providers, including technical electronic road toll systems shall ensure that operators and/or issuers offer the and financial conditions. European electronic toll service to their customers within the specified terms. Competent bodies (a legal And Article 3 of the Decision provides that EETS Providers shall seek registration base in the Roads Act will be in a Member State where they are established, which shall be granted if they required) fulfil the requirements that are specified there. Article 19 of the Decision states that: 1. For the purposes of the implementation of this Decision, each Member State shall keep a national electronic register of the following: (a) the EETS domains within their territory, including information relating to: (…) (b) the EETS Providers to whom it has granted registration according to Article 3. (…) Conciliation Body 11.  Under Chapter III of Decision of 6 October 2009 on the definition of the European electronic toll service and its technical elements  xemption from e-vignette 12. E and toll fees  ontrol – with possible 13. C cross references with other ordinance as for instance Ordinance for the Conditions and Procedure for Control by Electronic Means of Rules for Use of Roads and rules on access to databases by the Toll Charger – vehicle registration database, civil Article 9a of Directive 1999/62/EC states that insurance liability database. “Member States shall establish appropriate controls and determine the system of penalties applicable to infringements of the national provisions  anctions (a legal base in the 14. S adopted under this Directive. They shall take all necessary measures to Roads Act will be required) ensure that they are implemented. The penalties established shall be Breach of the obligation 14.1.  effective, proportionate and dissuasive.” for installation of on- board equipment Breach of the obligation 14.2.  of correct set-up of the on-board equipment assuring the correct fee is collected Other breaches 14.3.   rovisional provisions – 15. P regulating the transitional period for implementation 73 Annex B: Legal Changes B.3.Synchronization with Other Acts Act/Provision Suggested Approach Regulation for Application of the Roads Acts The vignette fee is mentioned in several provisions which need to be synchronized. In addition, art. 64 stipulate that RIA is a first level credit spending unit to the Council of Ministers. Paragraph 2 of this provision states that the funding source of RIA are “1. Subsi- dies and transfers from the state budget defined in the Law on the Budget for the respective year; 2. Taxes charged under art. 10 and art. 18, parra 3, p 1 for the Roads Act…”. Paragraph 3 states that the funds shall be spent for “1. Construction of new road infrastructure, 2. Exploitation, maintenance, repair and reconstruction of the republican roads …”. This provision may not need to be amended but should be synchronized with art. 44b para. 3 of the Roads Act which states that revenues from vignette fees cannot be used to finance the construction of new road infrastructure. Ordinance № 8121з-532 / 12.05.2015 on the conditions The ordinance regulating the use of technical means and and order for use of electronic technical means and systems for the control over the obligation related to the systems for control over the obligation for circulation of use of road, including using cameras for ascertainment of the roads an infringement and imposing electronic fines. The additions to this Ordinance should give a detailed explanation of the technical means for the use of such means for the purposes of control of the obligation to pay an e-vignette or a toll fee. However, the changes related to this may be introduced in another ordinance, including the ordinances under art. 10. In case of adoption of another ordinance it should be very well synchronized with this one in order to avoid collision of provisions and misinterpretations. Ordinance № H-19 of December 2, 2008 on the Only synchronization is needed. conditions and procedures for the release of persons with 50 per cent and over reduced work capacity or type and extent of disability, and individuals or families raising children with disabilities up to 18 years of age and until the completion of secondary education, but not later than 20 years of age, from the obligation to purchase vignette for the use of republican roads. Ordinance № H-20 of December 15, 2008 on the condi- tions and procedures for the compensation of the value of the free vignettes, received by persons with 50 per cent and over reduced work capacity or type and extent of disability, and individuals or families raising children with disabilities up to 18 years of age and until the completion of secondary education, but not later than 20 years of age, released from the obligation to purchase vignette for the use of republican roads Ordinance for the border controlling points adopted by The Ordinance covers the organization, activity and decision of the Council of ministers number management of the state border controlling points situated № 104/20.05.2002 in the internal and external borders and the coordination between the border control bodies in Bulgaria. The Ordinance includes provisions regulating the control of the vignette fee obligation. Synchronization is needed. 74 Annex B: Legal Changes B.4. Substantiation of the Amendments – infrastructure charge shall draw up a report on tolls, Analysis for Correspondence with EU Legal including concession tolls, levied on their territory and shall forward it to the Commission which shall make it Framework available to the other Member States. According to Art. 28 of the Law on Normative Acts, the • At least six months before the implementation of a new draft of the bill for amendment should be accompanied infrastructure charge tolling arrangement, Member States with substantiation for its adoption. The report containing shall send to the Commission: the substantiation shall include: (a) for tolling arrangements other than those involving • The reasons for the adoption of the amendments concession tolls: • The aims which those amendment pursue (i) (the unit values and other parameters used in • The financial and other resources which will be calculating the various infrastructure cost elements, and necessary for the implementation of the new framework (ii) clear information on the vehicles covered by the and analysis of the correspondence of the new provisions tolling arrangements, the geographic extent of the with European Union Law. network, or part of the network, used for each cost The Analysis of the correspondence of the new calculation, and the percentage of costs that are provisions with European Union Law is of utmost intended to be recovered; importance since the new provisions are closely linked to (b) for tolling arrangements involving concession tolls: Directive 1999/62/EC, Directive 2004/52/EC and Decision 2009/750/EC. (i) the concession contracts or significant changes to such contracts, Both Directive 1999/62/EC (Article 12), Directive 2004/52/ EC (Article 6) state that when Member States implement (ii) the base case on which the grantor has founded the Directives the national measures shall contain a the notice of concession, as referred to in Annex VII B to reference to the directives. This obligation may be Directive 2004/18/EC of the European Parliament and observed in case the suggestion to include a reference of the Council of 31 March 2004 on the coordination in art. 10 of the Roads Act is accepted and additional of procedures for the award of public works contracts, reference is made in the ordinance discussed above. public supply contracts and public service contracts; this base case shall include the estimated costs as defined in Article 7b(1) envisaged under the B.5. Communication to the European concession, the forecast traffic, broken down by type of vehicle, the levels of toll envisaged and the geographic Commission extent of the network covered by the concession The State shall have the following obligations for contract. communication to the EU Commission related to the • Within six months of receiving all the necessary implementation of a new E-vignette and Toll system in information in accordance with paragraph 1, the Bulgaria. Commission shall give an opinion as to whether the obligations of Article 7e are complied with. The opinions of the Commission shall be made available to the 5.1 Under Directive 1999/62/EC: Committee referred to in Article 9c. • Member States shall communicate to the Commission the text of the main provisions of domestic law which they adopt in the field covered by the Directive. The 5.2. Under Directive 2004/52/EC Commission shall inform the other Member States thereof. Member States shall immediately forward to the (Article 12). Commission the provisions, implementing the directive • Every four years after 16 October 2014 Member with a table correlating those provisions with the States which levy an external-cost charge and/or an Directive. Annex C: Enforcement of Foreign Vehicles 76 Annex C: Enforcement of Foreign Vehicles C.1. Introduction Similarly, it is likely that a vehicle with no means of payment under 3.5 tonnes will be committing a different The main body of this Deliverable sets out the proposed offence (not complying with e-vignette obligations) from enforcement concept. This is intended to be similar to the a vehicle over 3.5 tonnes (not complying with e-tolling process used by the Police for enforcement of speeding obligations) and we assume that the penalties for these offences and has the key advantage of not requiring the different offences will be different. Thus establishing stopping of vehicles at the roadside (except for limited whether a vehicle is under or over 3.5 tonnes is a critical defined cases), thereby improving the efficiency of step under the Administrative Violations and Sanctions enforcement and not needing to always involve Customs in issuing a penalty. In clear-cut cases, the enforcement in the enforcement of e-tolling and e-vignettes (as system will be able to establish this, but where the vehicle opposed to the sale of route passes and e-vignettes). is near the 3.5 tonnes boundary, the measurement However, detailed information has not been received systems are not precise enough to identify the weight from the Police regarding the agreements in place of the vehicle so establishing this requires access to the governing their cooperation with foreign enforcement appropriate vehicle registration database. bodies in respect of enforcement of foreign vehicles. It Access to the vehicle registration database is also required is therefore not possible to say with certainty whether to identify the owner of the vehicle to which the penalty such agreements can be adapted for the enforcement of should be addressed. e-tolling and e-vignettes with respect of foreign vehicles. Access to vehicle registration databases in other countries This annex therefore discusses the issues surrounding the would enable the enforcement body to confirm that an enforcement of foreign vehicles and the options available offence has in fact been committed, which offence that if the proposed enforcement concept is not possible for is and to whom the penalty should be sent. However, foreign vehicles. although the enforcement body is thus in a position Enforcement of foreign vehicles is a problem for all to send out a penalty, it cannot of course enforce it in countries with freeflow e-tolling and e-vignette systems so a foreign country. The enforcement concept therefore this draws on experience in other countries. envisages that if the penalty is not paid, it is sent to the enforcement body in that country for enforcement. C.2. Rationale for proposed enforcement and potential issues C 2.2 Potential Issues Under the proposed enforcement concept, vehicle C.2.1 Overview registration databases in other countries would be There are three key stages in the enforcement process: accessed via the EUCARIS system, which is used by the Police for enforcement of speeding offences. The use of • Establishing that an offence has occurred and which EUCARIS is governed by European Directive EU/2015/413, offence that is which lists the offences for which countries must provide • Establishing the owner of the vehicle to whom the mutual access to each other’s vehicle registration penalty should be sent databases. That list does not include e-tolling or e-vignette • Ensuring that the penalty is paid offences. Thus other countries cannot be forced to give Bulgaria access to their databases for the purposes of Establishing that an offence has occurred and which e-tolling or e-vignette enforcement. offence that is, often requires access to the relevant vehicle registration database, to establish the class However, there is nothing in the Directive which prohibits of vehicle. For example, the enforcement system can the use of EUCARIS for such purposes, provided that easily detect that a vehicle has no on-board unit, has Bulgaria has an appropriate bi-lateral agreement with not purchased a route pass and has not purchased an that country. It is understood that Bulgaria has such e-vignette. It therefore has no means of payment of e-tolls bi-lateral agreements (which precede in time Directive / e-vignette and is therefore likely to be committing an EU/2015/413) in place with a number of countries in offence. However, it may be that the vehicle is exempt, by relation to speeding offences and it is envisaged that virtue of its ownership, or by its vehicle type (e.g. vehicle these would be extended to cover e-tolling and e-vignette specially adapted for carried of disabled people) and is offences. However, as detailed information has not been therefore not actually committing an offence. This can received from the Police regarding such agreements, it is only be established by accessing the appropriate vehicle therefore not possible to say with certainty whether such registration database. extension would be possible. 77 Annex C: Enforcement of Foreign Vehicles Similarly, it is not possible to say whether the bi-lateral • Enforcement agency uses EDRA to obtain vehicle class agreements relating to enforcement of issued penalties details and ownership details to establish offence and could be extended.. owner • In accordance with AVSA, enforcement agency sends penalty to vehicle owner C.3 Options for Foreign Vehicle Enforcement • If vehicle owner does not pay penalty, enforcement C.3.1 Introduction agency sends penalty to EDRA for enforcement, either directly or via National Revenue Agency (NRA) The options presented in this section are not mutually exclusive. All would require some legal amendments not Alternatively, the penalty could be sent to the EDRA considered in Section 4 of the main Deliverable and would straightaway, instead of to the vehicle owner first. require further development with the bodies involved. The However, it would be necessary to establish whether that choice depends on the ability to use EUCARIS. would be in accordance with the requirements of AVSA. C.3.2 The Use of a European Debt Recovery Agency EDRA Used for Full Enforcement (EDRA) If the bilateral agreements cannot be extended to Many foreign toll roads, e.g. UK, Ireland, Norway, and cover either the use of EUCARIS or the use of foreign France and parking operators in Eastern Europe use an enforcement agencies, then it is possible to use an EDRA European Debt Recovery Agency (EDRA) to pursue foreign in a single stage process as follows: unpaid tolls. In the case the toll is seen as a civil debt in • Enforcement agency issues multiple penalties to the country of origin of the vehicle. The EDRA has access cover all possible cases (e.g. one penalty for an e-tolling to the owner details for that country and is paid a fixed fee violation and one penalty for an e-vignette violation if the for recovery, or a % of the sums recovered. enforcement system cannot establish with certainty which This is useful for large scale evasion e.g. by regular heavy applies) and sends them to the EDRA vehicle users, as the debt collection would be easier with a • The EDRA accesses the relevant vehicle registration corporate body. It is also useful for regular foreign evaders database to establish the correct penalty and the vehicle (e.g. cars registered abroad that travel a great deal inside owner Bulgaria). • The EDRA informs the enforcement agency about There are three variations. penalties which should be cancelled • The EDRA sends the correct penalty to the vehicle owner EDRA Used for Enforcement Only and collects the penalty If the bilateral agreements referred to above can be It is not clear whether this variation would be in extended to cover the use of EUCARIS but not the use accordance with the requirements of AVSA. However, it is of foreign enforcement agencies, then an EDRA could used extensively already in Europe. be used in place of foreign enforcement agencies. The sequence would then be: C.3.3 The Use of MEUs to Stop Foreign Vehicles • Enforcement agency uses EUCARIS to obtain vehicle MEUs could be used, as in other countries (e.g. Poland) class details and ownership details to establish offence to stop vehicles at the roadside to confirm whether an and owner offence is being committed, which offence and to issue • Enforcement agency sends penalty to vehicle owner a penalty which is immediately payable (or to collect a • If vehicle owner does not pay penalty, enforcement deposit of the value of the penalty which is refundable if agency sends penalty to EDRA for enforcement, either the penalty is not eventually issued). directly or via National Revenue Agency (NRA) The MEU could issue penalties both for offences detected at the time of stopping of the vehicle or for offences by EDRA Used to Obtain Vehicle Details and for that vehicle which have been previously detected by Enforcement stationary enforcement gantries but for which a penalty has not yet been issued or paid. If the bilateral agreements referred to above cannot be extended to cover either the use of EUCARIS or the use The disadvantages of this approach are that: of foreign enforcement agencies, then an EDRA could be • It can only capture a small percentage of evading used in a two stage process as follows: vehicles 78 Annex C: Enforcement of Foreign Vehicles • Since MEUs must be manned by uniformed officers Such an approach requires the agreement of Customs, with the power to stop vehicles, it increases the cost of a linkage between the ETC and Customs systems and operating MEUs enhancement of the Customs IT system to generate a penalty based on the data received from the ETC system. • When an MEU has stopped a vehicle, it may not be For such a process to be viable, without blocking a lane, physically positioned to act as a moveable enforcement the penalty must be immediately payable, without the gantry to detect offences of other vehicles (its primary driver having the possibility of disputing the penalty duty), thus lowering the operational efficiency of MEUs on the spot – later appeals would of course be possible • It runs counter to the trend in Bulgaria of not collecting to the SPE as for other vehicles. This approach may penalties at the roadside require changes in the law. It should be noted that Customs have stated that they would only be interested C.3.4 Penalising by Customs on Exit of Violators in a process which has this level of simplicity but also of e-tolling and e-vignette Violations have legal obligations until the end of the Schengen agreement. When a foreign vehicle comes to the checkpoint, the Customs operator would be informed that there If such an approach is not consistent with AVSA, then it are potential e-tolling or e-vignette violations for may be necessary to direct the vehicle to a holding area which penalties have not been issued. On the basis of for separate processing and issuing of a penalty rather information provided by the enforcement system and than blocking a lane. vehicle documentation provided by the driver, Customs by law would investigate whether an offence was actually committed, issues the appropriate penalties, and collects payment for these penalties. Annex C: Enforcement of Foreign Vehicles Annex D: Preceding Analytical Work 80 Annex D: Preceding Analytical Work D.1.Approach for Narrowing the Number of D.2.Narrowing the Number of Solutions Options The first key test is the financial one. Test have been There are numerous options that may be considered undertaken using only preliminary assessments of based on: costs and benefits, being clear that these will be further • Vignette, e-vignette or e-tolling for each vehicle type elaborated for the selected options. These assumptions and baseline data are presented in detail in Annex 7. • 4 possible road levels (from motorways down, to motorways plus roads class 3) The Figure below shows in green the areas that may generate sufficient revenue by combining technologies • 2 different technologies (GNSS or DSRC) and networks (more than BGN 400 million annually), and A solution was sought from these that could be delivered: in yellow those with over BGN 300 million annually. This • To meet the target for collecting additional revenues of shows that: at least BGN 400 million per annum • GNSS e-tolling of freight vehicles on motorways and class 1 roads meets the revenue target at affordable/ • Without risk of delay and loss of early revenue – 2017/18, reasonable charge per km and without any change for if possible light vehicles (BGN 488 million net per annum, as shown • Without politically unacceptable increase in travel costs on both figures) for users, especially for light vehicles • Class 2, or class 2 and 3 roads could be added may be at • Fairly – so that the polluter, or heavy user pays a lower general rate (now or in future), without additional • In line with other policies and social and economic revenue (up to BGN 808 million) factors, and other data needs. • The e-vignette for light vehicles does not add much net value at current rates (about BGN 24 million), but is a way In addition, the solution shall be easy to use and roll out, for the future without changing charges now based on proven approaches, in a way that facilitates procurement and maintenance of future toll roads. • Charging all vehicles bridges the revenue gap only with DSRC on motorways and class 1 roads (BGN 709 million) The approach applied in this analysis is red/ yellow/ green, or GNSS down to class 3 roads (BGN 653 million), but on the basis of the work done so far on this Deliverable, requires high charges per km for light vehicles (0.06 BGN/ or specially undertaken, as shown in Annex 3. That km), which is hardly likely to be acceptable. However, then required a special risk analysis for securing means and DSRC is limited to motorways and class 1 roads (so it is not usability for users. A simplified model was used to look a future proof ) into the financial consequences by applying cost and • The greater share of revenue may be obtained easier and benefits taken from similar schemes. Note that this faster through GNSS tolling only of heavy vehicles then was the first iteration of financial modeling meant to through more complicated solutions including DSRC or identify the broadest trends. Further detailed modeling is tolling of all vehicles. That is the least risky option offering described later in the paper. the best return. Figure 13. Revenue Projection, including GNSS for Light Vehicles Policy Options - Net Revenue (Mio. BGN) Minimum BGN 400 Mio. is needed for effective Road Infrastructure Financing E-tolling HGV + buses and Current E-tolling HGV + Baseline – Vignette Light buses and E-vignette Current Vehicles + Passenger Light Vehicles + All Vignette Cars Passenger Cars E-tolling vehicles DSRC GNSS DSRC GNSS DSRC GNSS motorway 218 non viable 252 non viable 232 non viable motorway + 1st class roads 392 464 417 488 444 -421 200 motorway + 1st + 2nd class roads non viable 674 non viable 703 non viable -81 motorway + 1st + 2nd + 3rd class roads non viable 773 non viable 806 non viable 110 81 Annex D: Preceding Analytical Work Figure 14. Projection of Tolling at Lower Charges for Light Vehicles Policy Options - Net Revenue (Mio. BGN) Minimum BGN 400 Mio. is needed for effective Road Infrastructure Financing E-tolling HGV + buses and Current E-tolling HGV + Baseline – Vignette Light buses and E-vignette Current Vehicles + Passenger Light Vehicles + Vignette Cars Passenger Cars E-tolling All vehicles DSRC GNSS DSRC GNSS DSRC GNSS motorway 218 non viable 252 non viable 307 non viable motorway + 1st class roads 392 464 417 488 709 -156 200 motorway + 1st + 2nd class roads non viable 674 non viable 703 non viable 347 motorway + 1st + 2nd + 3rd class roads non viable 773 non viable 808 non viable 653 Average Toll Rates Average Toll Rate per km HGV + buses [BGN] 0.24 Average Toll Rate per km Light Vehicles + Passenger Cars [BGN] 0.06 D.3.Evaluation of Other Factors including how easy the option would be to use by Though revenues are a key driver, an evaluation was light and heavy vehicles. These are summarized performed of all other aspects mentioned in this hereunder – full details of each aspect subjected to Deliverable (e.g. possibility to implement the policy), evaluation are provided in Annex 3. Figure 15. Summary of all Factors Impacting Strategic Options Current etolling e-vignette all vehicles vignette trucks lights etolling policy finance depends on rates legal socio economic/ environment ease of use risk to delivery of finance procurement This table shows that: easy to use for light vehicles and would be a key delivery risk • The current vignette fee neither supports the policy, nor can secure sufficient revenue Since implementation of e-tolling features three red • Only etolling of trucks and evignette of light vehicles areas, each one of which is sufficient to dismiss any have no significant issues of delivery further evaluation, the recommendation made in Deliverable 0 was to focus on: • Etolling all vehicles would not deliver the revenue needed without high charges for light vehicles (with • E-tolling for trucks only and e-vignette for light associated socio economic impacts), would not be vehicles 82 Annex D: Preceding Analytical Work • Considering options for roads class 2 and 3 in addition D.4.Vision for the Service to motorways and roads class 1, since diversion and traffic flow are important The vision is based on a review of the current vignette system and best practices of e-tolling and e-vignettes as • Studying e-tolling rates in comparison with the revenue developed in other parts of Europe and worldwide. balance for that option The purpose of our strategy has been to elaborate a vision, • Considering e-vignette fees and the possibilities to which brings the lowest risk in case additional funds are reduce costs by means of a single contract secured quickly, generates good net revenues due to the Even if the initial revenue evaluation would change in cost-effectiveness of the solution and is well accepted by future, it has been agreed that the remaining red factors, users. such as easy use, shall preclude from further consideration That implies that solutions proven elsewhere shall be e-tolling of all vehicles. adopted and tailored for Bulgaria, rather than assuming a Deliverable 0 was focused on feasible scenarios in a more innovative but potentially risky technical approach. set of strategic options, which were then studied in The overall vision for the system is shown in the figure greater detail based on GNSS for heavy vehicles and below. e-vignette for light vehicles at various levels of road coverage and tariffs. Figure 16. Proposed Vision This shows that: • Bulgarian and foreign light vehicles will buy an evignette, similar to the current approach but linked to their number • Bulgarian heavy vehicles would be electronically plate and stored electronically tolled using either existing technology in their vehicles or via new on board units or for occasional users, simply • Foreign and transit vehicles would buy route passes, by buying “route passes” that allow travel on a particular buy or rent an on board unit or in the future, use EEST route and time services 83 Annex D: Preceding Analytical Work Payments can be made to accounts with Service • The capture of the key revenue from transit traffic can Providers by using bank or debit cards, or bank accounts, be by “route passes” or adjustment of on board units, and or linked to other forms such as fuel cards. Users can pay in future by operationally connected EEST interoperable on line, by phone, or by post and e-vignettes can be also units, and by potential use of the current Customs bought for cash at post offices. organization. All three types of user can be enforced by the same • Enforcement of the e-tolling system provides a good system that checks number plates against payments and opportunity to also deploy an e-vignette system for light issues penalties to non-compliant users. The enforcement vehicles in the same contract. will be a mix of mobile and fixed sites that will be • This approach could help deliver other government discussed in detail in the next phase. policies, for example reduction of emissions from vehicles by different pricing and support for future Intelligent Transport System Services. Key benefits of this are: Regardless of all that, there are legal and institutional • Such a system can be procured readily in the market aspects that need to be addressed to support with a minimal risk for the Contractor that would supply introduction of e-tolling and e-vignettes. the entire technology and base services. Later other companies may provide added services, for example Additional analyses have been undertaken in the current use of existing equipment inside vehicles for fleet Deliverable focusing on revenues and operational management for securing data needed to calculate toll models. charges. Annex E: Etolling Case Studies 85 Annex E: Etolling Case Studies Country South Africa – Gauteng Region Vehicle types charged All vehicles (with some exemptions) Date introduced (actual or December 2013 actual, planned to be introduced before World Cup in 2010. planned) Number of vehicles charged In the 6 month period December 2013 – May 2014 a total of 1.2m users paid tolls. During the same period toll revenue of 678m Rand was collected (44m Euro). Length of road network 185km – the Gauteng e-road network, all Freeway standard covered Purpose of the scheme To raise funds for freeway improvement necessary because of severe congestion. From the Sanral (equivalent of RIA) website : Tolling is important because ... • It contributes towards a high quality road network. • It contributes to improved road safety. • It decreases vehicle operating costs. • Its “user-pay” principle offers a fair way of paying for road usage. What was the brand name? Was there any ‘key message’ The scheme was primarily presented as being a method of funding the Gauteng used in the publicity for the Freeway Improvement Project (GFIP) scheme? Who was responsible for Whilst some of the PR & Marketing tasks were outsourced to the Contractor, Sanral the comms strategy (wholly (the road authority) was responsible for the communications strategy as a whole. within the Government/toll charger or outsourced to e.g. PR company)? What communication A wide range was used including media were used to banners on motorways but its publicize the scheme? effectiveness is not clear. What steps were taken to Reports are that : involve stakeholders? Public engagement was relatively low key. For example, only 82 representations were received for the toll declaration process in 2007 (Department of Transport, 2012). Public comments received questioned the necessity of tolling, impact on the economy, impact on secondary roads due to traffic diversions, and general sentiments that tolling of existing urban roads is unacceptable. Did the scheme proceed to Yes, but only after extensive delays to the scheme due to large scale opposition to operation? the scheme from a range of parties. 86 Annex E: Etolling Case Studies What were the main reasons The Freeway network and its funding was considered in isolation from the rest of for the success/failure of the the Gauteng metropolitan transport network and this caused many impacts from scheme? the lack of integration including social exclusion, equity etc. It should be noted that SANRAL is the national freeway authority and has no responsibility for wider transport matters. eToll was planned by them with limited involvement of other transport service providers. The scale of opposition was underestimated, opposition was anticipated from some sectors, such as the taxi industry in Gauteng, but the widespread scale of opposition and legal challenges were not anticipated or mitigated sufficiently. (‘Taxis’ are mainly unregulated minibuses that provided the main form of public transport in the area. There were very large numbers of them and they viewed eToll as a direct threat to their revenue). The report also highlights the lack of understanding of the importance of politics and the political/democratic processes. The Gauteng e-toll project (originally called Gauteng Redress-oriented Recommendations include: Open Road Tolling Project) is part of the Gauteng Freeway a) Revise the e-toll funding model to accommodate Improvement Project (GFIP) – a major road infrastructure serious gaps and negative social impact. The ITMP 25 improvement scheme. states, “levying of tolls should be part of a holistic approach Whilst the e-toll scheme was very controversial and to road financing and has a role to play in a province such as suffered substantial delays bringing it into operation Gauteng.” This consideration as part of a hybrid model has to due to major objections and legal challenges, it must be be considered. remembered when comparing with other schemes that: b) GFIP Implementation Strategy Review with a • The scheme is not a national scheme, it is closely linked Comprehensive Stakeholder Engagement for developing a with the metropolitan areas of Johannesburg and Pretoria commuter-centric integrated transport system with cost and (although SANRAL intended to extend it to other areas benefit sharing models where freeways needed improvement); c) Legislative frameworks review to enhance cooperative • At the time of scheme planning and implementation, governance for alignment and innovative financing transport planning and provision in South Africa was not d) Development of a Comprehensive Social Impact Plan with well integrated and public transport (largely unregulated an objective beyond congestion reduction covering spatial taxi minibuses) was of poor quality; dimensions, gender perspectives, and issues of disability • The historic background of South Africa and the legacy e) Formulate and/or Consolidate Strategy and Funding of apartheid mean that issues of social inclusion and Models and Plans for Integrated and Transformative Gauteng equity are extremely high on the political agenda; Public Transport. Incorporate Metro BRT (A Re Yeng, Tshwane • The scheme covers all types of vehicles, and therefore Metro, Rea Vaya, City of Johannesburg, PRASA, Gautrain, etc.). was a radical change to the road users and general f ) Fast-track implementation of Gautrain Integrated Transport population of Johannesburg and Pretoria; Authority There are complex social, political, institutional and g) Identify alternatives and mitigating measures and revise economic reasons for the out-cry about tolling that government response to social consequences accordingly occurred that may be particular to Gauteng and South Africa. A report prepared by the Gauteng Government h) Develop a social impact management and monitoring of social impact Socio-economic Impact Gauteng Freeway (November 2014) describes in detail many of the above Improvement Project and E-tolls issues related to communication strategy, policy decisions and the failures and problems that occurred on the The introduction of complex systems, such as advanced scheme. The following extracted recommendations transport systems, requires effective monitoring and evaluation illustrate some of the main issues that the scheme faced: from commencement of the programme, in order to identify 87 Annex E: Etolling Case Studies the practicability and workability of a particular policy or taken place in a heightened political climate accompanied by programme, thereby to inform minor or major adjustments massive civil disobedience. Whilst the underlying sentiments as the system unfolds and matures. Regular or periodic of the campaign, including the anger and frustration about monitoring and evaluation of social impact is as important perceived and real lack of consultation, complexity of the as monitoring and evaluation of economic, political, legal or system, billing problems, conflicting information and pressure environmental impact. A few of the key social impact issues on household incomes, the Panel can see no justification that emerged in the course of the consultations and the for the campaign, which sets unsustainable precedents and deliberations of the e-toll Panel were the need for heightened threatens democracy and social cohesion. The campaign of transparency and public accountability of governmental non-payment must also be weighed up against the evidence institutions; the requirement for clear, effective and respectful of payment of R 678 m by 1.2m users in the 6-month period 3 public communications; as well as the need for fair treatment December 2013 to 31 May 2014. of citizens by public office-bearers. The inference is drawn that The substantive recommendation of the Panel is that there social monitoring and evaluation should incorporate the basic should be a process of engagement between national, foundational aspects of understanding the social impact of provincial and local government to decide on changes a particular complex system such as GFIP and e-tolls on road recommended by the Panel, and thereafter to communicate users who are required to pay, but should also incorporate the these changes to all interested and affected parties in social impact of the governance of the particular system. the most direct manner possible. This would require commitment from political parties to communicate with their Further recommendations from a review of the scheme constituencies as per their undertakings in their submissions were: to the Panel; face to face engagement with major organized The Panel acknowledges that there have been numerous formations who made representations to the Panel; provision previous consultation processes. By its nature, consultation can of information to all vehicle owners through the motor vehicle never be exhaustive and nor will it result in 100% consensus. license registration system; and implementation of a public The Panel has also observed that the opposition to e-tolls has communication strategy and plan. 88 Annex E: Etolling Case Studies Country UK – Dartford Crossing Free Flow Vehicle types charged Cars, trucks but not motorbikes. Significant exempt vehicles. All tolls free overnight. Varied charge for account holders vs non account holders. Date introduced (actual or 1 Dec 2015 planned) Number of vehicles charged 160,000 per day. Over 2 million in account database Length of road network 4km covered Purpose of the scheme Reduce congestion at strategic river crossing and remove existing cash and tag toll barriers to replace with freeflow charge via number plate reading What was the brand name? Was there any ‘key message’ no need to stop and pay cash used in the publicity for the opening an account means you don’t have to remember to pay, and saves you money scheme? Who was responsible for Highways England (SPE equivalent) appointed a dedicated communications the comms strategy (wholly specialist with government and major event experience. He developed the overall within the Government/toll comms strategy with advice from contractors and other schemes. charger or outsourced to He leads a team of client and contractor specialists and reports to Government. The e.g. PR company)? contractor developed materials (letters, website, emails, twitter, Facebook, for client approval and ran social media. Advertising used PR agency and media house What communication Radio adverts, web adverts, washroom media were used to advertising, stories in stakeholder publicise the scheme? publications, leaflets in car tax reminders, letters and emails to existing users, twitter, Facebook, interviews with media, YouTube channel https://www.youtube. com/watch?v=03pdVThpxyw Stands in shopping centres, roadshows, posters in service stations, leaflets in major destinations, radio traffic news, TV news https://www.youtube.com/ watch?v=Ez4tD9kFvo8 Second wave of radio adverts for summer tourists and occasional users. 89 Annex E: Etolling Case Studies What steps were taken to Many meetings with stakeholders eg involve stakeholders? Freight Associations, rental companies, ports, Caravan Club, Disabled users, Sports venues, AA and RAC (motoring clubs), Police and other exempt users . Letters to existing users. Wide range of foreign language information via foreign truck association partners eg Bulgarian language leaflets. Did the scheme proceed to Yes operation? What were the main reasons Having an agreed plan of communications leading to go live, and fall back plans for the success/failure of the if things were not as expected. Strong account takeup before go live. Use of social scheme? media and stakeholders as “free “channels to public. 90 Annex E: Etolling Case Studies Country Ireland M50 Freeflow Vehicle types charged Cars and trucks Date introduced (actual or 2008 (actual) planned) Number of vehicles charged 100,000 per day Length of road network 45km covered Purpose of the scheme Reduce delays at barrier toll booth on ring motorway around Dublin What was the brand name? Was there any ‘key message’ We are all about you and your journey used in the publicity for the scheme? Who was responsible for NRA (RIA) originally but this plan is now set by the contractor under the overall the comms strategy (wholly agreement with government. The Contractor now organises all publicity and within the Government/toll marketing channels, social media and media responses and responds to day to day charger or outsourced to liaison. Large fleet liaison team operated by the contractor e.g. PR company)? What communication Before go live, roadside boards, TV, newspaper adverts, leaflets at existing barriers, media were used to signs on gantries, media spots, radio and leaflets. publicise the scheme? Now social media and website, corporate sponsorships (eg football teams) and web are more widely used as the service enters steady state. What steps were taken to Meetings with fleet associations and large fleets, rental companies, airport, Police, involve stakeholders? AA etc. Wide range of public information and contact with local businesses and communities Did the scheme proceed to Yes operation? What were the main reasons Having a clear message and adapting the plan as new channels develop (twitter for the success/failure of the was not invented yet). Adopting the communications plan to local people’s needs. scheme? Selling the benefits of the scheme in all publicity and reporting quickly on time savings. Being able to react quickly to minor problems before they become wider. 91 Annex E: Etolling Case Studies Country Poland Vehicle types charged All vehicles > 3.5 Tonnes Date introduced (actual or 1 July 2011 planned) Number of vehicles charged > 1.1 Million Length of road network 3150 km covered Purpose of the scheme Replace revenue from discontinued Vignette scheme to fund road maintenance. What was the brand name? Was there any ‘key message’ • system will start operation on 1 July 2011 used in the publicity for the • system is obligatory for vehicles over 3.5T scheme? • how / when / where to register • where to find further information • information provision about : system (easy to use, fair, etc.), OBU, enforcement, etc • system fully complies with EU regulations Who was responsible for The contractor was obliged to develop a communications the comms strategy (wholly plan and to submit it to GDDKiA for approval. The within the Government/toll Contractor was also obliged to execute the agreed plan charger or outsourced to before and at launch and also maintain an agreed level of e.g. PR company)? PR during the entire project. What communication TV, radio, newspapers, magazines, trade publications, CB media were used to radio, newsletters, signs, PR articles, flyers and posters at publicize the scheme? OBU distribution points and customer contact centers (hosted in truck dealerships). What steps were taken to Campaigns were carried out at several stages prior to launch. Involvement of truck involve stakeholders? associations and other user bodies including surveys and special information days held regionally. Foreign language material Did the scheme proceed to Yes. Users were encouraged to register and obtain an OBU before launch and as a operation? consequence, queues of trucks during the first weeks after launch were minimized What were the main reasons Strong and well planned publicity campaign and user engagement well in advance for the success/failure of the of launch. scheme? 92 Annex E: Etolling Case Studies Country France Vehicle types charged All vehicles > 3.5 T Date introduced (actual or Cancelled after system implementation. planned) Number of vehicles charged 0 (although approximately 800,000 vehicles were anticipated to use the system) Length of road network 15,000 km covered Purpose of the scheme Counteract diversion of traffic from tolled motorways onto National Roads. French government wanted to introduce ‘polluter pays’ principle in road use charging. What was the brand name? Was there any ‘key message’ Objective of system was to charge vehicles on a distance basis to recover used in the publicity for the environmental costs. scheme? System would be mandatory for all vehicles above 3.5T. Who was responsible for Joint responsibility between Government and Operator. However publicity to and the comms strategy (wholly engagement with users was hampered by uncertainty over the introduction date. within the Government/toll charger or outsourced to e.g. PR company)? What communication System launch was not widely publicized due to uncertainty of launch date. media were used to publicize the scheme? What steps were taken to Onboard units were issued by service providers which are already onboard unit involve stakeholders? issuers within the TIS-PL ETC scheme which operates on French (concession- operated) Motorways. As onboard units were mandatory, these service providers were in the front line in marketing payment accounts to users. Did the scheme proceed to No. Over 200,000 users were registered in the scheme by service providers (SPs operation? were contracted to the operating entity Ecomouv) however government did not proceed with operation of the scheme. Extensive compensation had to be paid to the contractor. What were the main reasons The scheme was cancelled due to major objections of users and in particular for the success/failure of the roadside protests and vandalism in some regions of France such as Brittany, where scheme? farmers perceived they were disadvantaged and that promises of free roads had been broken. The “Bonnet Rouge” movement had strong support locally and caused the collapse of political support for the system. Also having an Italian contractor caused further political issues. http://www.france24.com/en/20131029-france-ecotax-brittany-farmers-food- climate-taxes-protests has more details 93 Annex E: Etolling Case Studies 94 Annex E: Etolling Case Studies Country Austria Vehicle types charged All vehicles > 3.5 T Date introduced (actual or 1 January 2004 planned) Number of vehicles charged > 1 Million Length of road network 2183 km covered Purpose of the scheme Finance road network construction, maintenance and operation. ASFiNAG, the operator of all Motorways and Express roads in Austria is fully financed from HV electronic toll and LV Vignette systems. What was the brand name? Was there any ‘key message’ Emphasis was placed on the relationship between the kilometer-based charge and used in the publicity for the users’ actual use of the network. Because the distance based charge replaced a scheme? time-based vignette as in Bulgaria, this resulted in a high level of acceptance among users. Efforts were made to maximise information to users about the business rules of the new scheme as well as about the OBU, to achieve a high level of awareness among users in advance; Feedback from users was that they did not consider the system as a burden; The mandatory use of the OBU was also part of the key messages, users (especially foreign) were encouraged to equip themselves as soon as possible so not to have problems when entering Austria. Who was responsible for The implementation of the communication strategy was part of the responsibilities the comms strategy (wholly of Europass LKW-Mautsystem GmbH. (The service provider in charge of the design, within the Government/toll finance, build, operation and maintenance of the system, under close coordination charger or outsourced to with the Toll Charger ASFINAG. A communication strategy and budget was a e.g. PR company)? requirement of the tender and was implemented with the support of a local PR agency. What communication All types of media were used to communicate about the upcoming scheme, media were used to including newspapers, magazines, tv and radio broadcasting. publicize the scheme? What steps were taken to Specific communication measures were implemented by means of the local and involve stakeholders? regional chambers of commerce. Several dissemination meetings were organized with the end users with the support of the chambers of commerce in Austria; similar actions were undertaken abroad, in the neighboring countries. Did the scheme proceed to Yes. operation? What were the main reasons Austria was the first nationwide free-flow electronic tolling scheme to be launched for the success/failure of the in Europe requiring a mandatory OBU. The main success factors included : scheme? • The date for the start of operation of the system (1st January) was planned well in advance by ASFiNAG and was never in doubt. Because of this, communication actions also started well in advance outlining this date. 95 Annex E: Etolling Case Studies • Consequently everyone was aware knew that the system would be launched and when. This is contrast with Ecotaxe in France, where the government didn’t want to start any communications whilst there was uncertainty over the start date. • Emphasis was also placed in communications on the relationship between the kilometer-based charge and users’ actual use of the network. This resulted in users’ perception that the charge would be fairer than the previous time based Vignette. 96 Annex E: Etolling Case Studies Country Germany Vehicle types charged Goods vehicles > 12 T (> 7.5 T from 1 October 2015) Date introduced (actual or 2005 planned) Number of vehicles charged 90% of the revenues are made through customers using the automatic system which requires an onboard unit to be fitted to vehicles. 940,000 OBUs were installed in trucks > 12 T. From October 2015, the population of vehicles liable to toll has increased to over 1.39 Million. Length of road network 15,100 km covered Purpose of the scheme The scheme was introduced due to increasing road wear and tear due to increasing levels of transit traffic particularly heavy trucks What was the brand name? Was there any ‘key message’ Display- User sees what he pays/ psychological aspect used in the publicity for the No Infrastructure required to collect tolls scheme? Who was responsible for Toll Collect PR Department (Toll Collect is the Private special purpose company the comms strategy (wholly established to operate the system). within the Government/toll charger or outsourced to e.g. PR company)? What communication Most effective were communications via media were used to road administrations and organizations publicize the scheme? internationally, at borders, with visible signs close to every border on the international side. What steps were taken to Meetings - presentations, displays, teams wherever drivers take breaks, flyers, involve stakeholders? Internet, etc. Did the scheme proceed to Yes. operation? What were the main reasons High acceptance due to information provided in advance and involvement of all for the success/failure of the parties. scheme? Part 2: Draft Master Project Management Plan (including a Draft Project Charter) 98 Part 2: Draft Master Project Management Plan Summary supporting organizations throughout the project life cycle phases to ensure a timely, efficient, and effective system The purpose of this Master Project Management Plan implementation and operation. (MPP) is to capture and define ‘how’ the project will be managed throughout the project life cycle, and to Hence it will be a living document, continuously updated. provide Government and other project stakeholders The Project Management Plan is based primarily on the with an approved working guide for how the project project management processes described in the Project will be managed. The MPP describes how to manage Management Body of Knowledge (PMBOK), 5th edition the activities of the project, the Contractor, and other and addresses the following areas of knowledge: Project Integration Management : •  processes and activities to identify, define, combine, unify, and coordinate the various processes and project management activities within the Project Management Process Groups. Project Scope Management : •  processes to ensure that the project includes all the work required, and only the work required, to complete the project successfully. Project Time Management : •  processes to manage the timely completion of the project. Project Cost Management : •  processes for planning, estimating, budgeting, financing, funding, managing, and controlling costs so that the project can be completed within the approved budget. Project Quality Management : •  processes and activities of the performing organization that determine quality policies, objectives, and responsibilities so that the project will satisfy the needs for which it was undertaken. Project Human Resource Management : •  processes that organize, manage, and lead the project team. Project Communications Management : •  processes required to ensure timely and appropriate planning, collection, creation, distribution, storage, retrieval, management, control, monitoring, and the ultimate disposition of project information. Project Risk Management : •  processes of conducting risk management planning, identification, analysis, response planning, and controlling risk on a project. Project Procurement Management : •  processes necessary to purchase or acquire products, services, or results needed from outside the project team Project Stakeholders Management : •  processes to identify all people or organizations impacted by the project, analyzing stakeholder expectations and impact on the project, and developing appropriate management strategies for effectively engaging stakeholders in project decisions and execution. 99 Part 2: Draft Master Project Management Plan One of the main elements of this Master Plan is the project enforcement, as well as overseeing the Contractor as schedule. The high level schedule is shown below. discussed in the Deliverable section on procurement. If This schedule assumes that a Special Purpose Entity this is not required, the overall go live timelines do not is required for all aspects of tolling procurement and change as this Entity is not on the critical path for delivery specifically to have the legal role in issuing penalties for as an enforcement body will still have to be trained. The milestones indicated along the timeline at the bottom • Contractor delivery of operational services for the of the diagram shows that the plan enables the following duration of the contract achievements: • Handover of enforcement technology and facilities to • Award a contract for provision of the necessary systems the Special Purpose Entity or other body and services – March 2017 • Commencement of e-toll collection for Heavy vehicles – The World Bank study is now completed. After that, it February 2018 is essential that two tasks (shown in green) are started immediately: • Commencement of e-vignette operations for Light Vehicles – July 2018. Note that this is split from e-tolling to • Decisions to be made. This task is for Government to spread customer operations, communications and testing make final decisions on the main issues that are identified loads in the World Bank study that need to be resolved. Without these decisions, it is impossible to proceed. This has now • Commencement of enforcement operations and been done. contract monitoring by a Special Purpose Entity or other enforcement body as required – February 2018 • Planning for preparation of the Tender Documents and Project Management. This task is to plan and The main activities and products are: organize the tasks needed to deliver the tender • Preparation of tender documents documents (but not the contents of them) and to put in place all of the necessary project management • Legal changes to enable e-tolling and e-vignette documentation (as described in the Master Project Plan). • Legal changes to establish the Special Purpose Entity (if As part of the preparation of Tender Documents it will be required) necessary to capture requirements from a wide range of • Contractor implementation of systems stakeholders. In particular, as described in Deliverable 1 100 Part 2: Draft Master Project Management Plan there are many potential benefits to be obtained by legal stages required for introduction of the Government close co-operation between the e- tolling /e-vignette Special Purpose Entity can be continued in parallel with systems and Intelligent Transport Systems (ITS). the procurement process. Therefore during this phase of activity it will be necessary After the procurement stage, a contract is awarded to work closely with the organisations involved in and implementation commences (shown in orange). the development of ITS in Bulgaria to ensure that During the implementation stage there are two main data and information flows and system architecture milestones: considerations are addressed and the full benefits can • Commencement of revenue collection using the be obtained in the future. During this phase it will be e-tolling system necessary to analyse the implementation plans for ITS to identify when particular functionality may be required. • Commencement of revenue collections using the Government has already begun to discuss the service e-vignette system with ITS Bulgaria for example. These have been separated in time since the e-tolling When both of these tasks are complete, the three main based toll collection should start as early as possible, activities (shown in blue) can be started: and the e-vignette system should commence at a time that makes the transition between the existing • Preparation of contents of Tender Documents. This is vignette scheme and the e-vignette scheme possible a major task that involves a broad range of parties with and convenient for road users. Since the existing sticker the necessary skills and experience of preparing such vignette scheme includes annual vignettes, a plan will documents. It also involves the stakeholders since it is be required to phase out the sales of these, so that no necessary to identify and capture their requirements for annual vignettes will be sold for the period beyond inclusion in the tender documents. the commencement dates of both the e-tolling and • Legal changes for enabling e-tolling and e-vignette. e-vignette systems. The e-vignette system is shown This is a sequence of tasks to identify and make the as starting in July 2018, so the plan must enable the necessary legislative changes to enable e-tolling and phasing out of sticker vignettes to match this date. The e-vignette to be used for charging for the use of roads planning of this requires consultation and coordination in Bulgaria. There will also be some legislative changes with those responsible for management of the existing needed to support the introduction of a Government sticker vignette scheme. Special Purpose Entity (if required). It has been assumed that the Special Purpose Entity will • Legal Stages for the establishment of a Government require time to implement in terms of staffing, offices Special Purpose Entity. These are the legal tasks and facilities (shown in purple), and that a period of necessary to implement legislation to introduce the training and knowledge transfer is required before Special Purpose Entity (if required). the Entity can commence enforcement activities and contract monitoring which must both start at the The legal changes are now understood to be underway. same time as the e-tolling system goes live in February When the first two of these tasks are complete, it is then 2018. Examples are understanding the business rules, possible to start the procurement process (shown in the capacity of the system in for example issuing and yellow). It has been assumed that this process cannot printing penalties once the SPE has approved them be started until the necessary legislative changes have and the appeals facilities in the system (often using a been made. However, it has also been assumed that the Customer Relations Management tool). 101 Part 2: Draft Master Project Management Plan 1. Introduction B. Scope of this Master Project Management Plan In this document a draft version of the Master Project Management Plan (MPP) is presented. This Master Project Management Plan identifies the activities, processes, and procedures used to manage A. Purpose the project. The MPP further presents the methodology for project management that will be employed for each The purpose of the Master Project Management Plan is project management phase, as well as a brief description to capture and define ‘how’ the project for delivery of of each of the component plans of the MPP. toll collection systems and services in Bulgaria will be managed throughout the project life cycle, and to provide This Master Project Management Plan is based primarily the project stakeholders with an approved working guide on the project management processes described in the for how the project will be managed. The MPP describes PMBOK, 5th edition. The methodology for planning the how to manage the activities of the project, the contractor project utilizes the aspects of the PMBOK where applicable (or contractors), and other supporting organizations to the project based on its size, complexity, and staff resources. throughout the project life cycle phases to ensure a timely, efficient, and effective system implementation and The scope of PMBOK is shown below in Figure 16 which operation. identifies the following 10 areas of knowledge. 102 Part 2: Draft Master Project Management Plan Figure 17. Scope of PMBOK Project Integration Management : •  Project Integration Management includes the processes and activities needed to identify, define, combine, unify, and coordinate the various processes and project management activities within the Project Management Process Groups. Project Scope Management : •  Project Scope Management includes the processes required to ensure that the project includes all the work required, and only the work required, to complete the project successfully. Project Time Management : •  Project Time Management includes the processes required to manage the timely completion of the project. Project Cost Management : •  Project Cost Management includes the processes involved in planning, estimating, budgeting, financing, funding, managing, and controlling costs so that the project can be completed within the approved budget. Project Quality Management : •  Project Quality Management includes the processes and activities of the performing organization that determine quality policies, objectives, and responsibilities so that the project will satisfy the needs for which it was undertaken. Project Human Resource Management : •  Project Human Resource Management includes the processes that organize, manage, and lead the project team. Project Communications Management : •  Project Communications Management includes the processes that are required to ensure timely and appropriate planning, collection, creation, distribution, storage, retrieval, management, control, monitoring, and the ultimate disposition of project information. Project Risk Management : •  Project Risk Management includes the processes of conducting risk management planning, identification, analysis, response planning, and controlling risk on a project. Project Procurement Management : •  Project Procurement Management includes the processes necessary to purchase or acquire products, services, or results needed from outside the project team Project Stakeholders Management : •  Project Stakeholder Management includes the processes required to identify all people or organizations impacted by the project, analyzing stakeholder expectations and impact on the project, and developing appropriate management strategies for effectively engaging stakeholders in project decisions and execution. Within each of these areas of knowledge, project throughout the project. From the point of view of project management processes are defined. There are a total of management, a typical project is divided into 4 main 47 processes typically used during the management of a project management phases as shown in Figure 18 below. major project. These processes are used at different times 103 Part 2: Draft Master Project Management Plan Figure 18. Project Management Phases The diagram shows that 4 of the phases run as a to replan and change the execution, however for the sequence from initiation through to closure of the purposes of explaining the content of this document the project. The 5th phase, Monitoring and Control, runs diagram is sufficient. in parallel to the main phases of the project. This is a The following table shows which of the processes simplification on most projects, because changes or contained within each Knowledge Area are used within unexpected events can sometimes result in the need each of the Project Management Phases. Table 2. Mapping of Knowledge Areas onto Project Phases for Delivery of Tolling in Bulgaria Project Phase Knowledge Initiation Planning Executing Monitoring and Closing Areas Control Project Develop Develop Project Management Direct and Monitor and Close Project Integration Project Plan Manage Project Control Project Management Charter Work Work Perform Integrated Change Control Project Scope Plan Scope Management Validate Scope Management Collect Requirements Control Scope Define Scope Create WBS Project Time Plan Schedule Management Control Schedule Management Define Activities Sequence Activities Estimate Activity Resources Estimate Activity Durations Develop Schedule Project Cost Plan Cost Management Control Costs Management Estimate Costs Determine Budget Project Quality Plan Quality Management Perform Quality Control Quality Management Assurance 104 Part 2: Draft Master Project Management Plan Project Phase Knowledge Initiation Planning Executing Monitoring and Closing Areas Control Project Human Plan Human Resource Acquire Project Resource Management Team Management Develop Project Team Manage Project Team Project Plan Communications Manage Com- Control Communications Management munications Communications Management Project Risk • Plan Risk Management Control Risks Management • Identify Risks • Perform Risk Analysis • Plan Risk Responses Project •  Plan Procurement  onduct • C •  Control • C  lose pro- Procurement Management Procurements procurements curements Management Project • Identify • Plan Stakeholder  anage • M  ontrol • C Stakeholders Stake- Management Stakeholder Stakeholder Management holders Engagement Engagement C References The Contractor’s PMP is a contractually defined management document to be developed by the • Project Deliverable Number 1 Contractor to manage his obligations. The PMP is • Project Charter subordinate to the MPP and will be developed by the Contractor according to specific requirements that will be included in the contract documents. D Document Maintenance This document will be reviewed and updated as needed, as the project proceeds through each phase. Lessons learned as a result of continuing staff management efforts will be captured at the end of each project phase and used to improve the project. E Relationship between this Master Project Management Plan (MPP) and the Contractor’s Project Management Plan (PMP) The MPP is developed and controlled by the project management team and is the highest-level project management document. The MPP is for the project management team to manage the entire process of system implementation, bringing the system into operation, and continuing operations. 105 Part 2: Draft Master Project Management Plan 2 Project Initiation Phase This section describes the processes involved in carrying out the project initiation phase of the project management activities, as illustrated in the diagram below. Figure 19. Project Initiation Phase A Develop Project Charter B Identify Stakeholders This is the process of developing a document that This is the process of identifying the people, groups authorizes the project by its being endorsed and or organizations that could impact or be impacted agreed by “signing up” of the project sponsor and senior by a decision, activity or outcome of the project both management of both Contractor and Government. within Bulgaria and internationally. Part of this process The Project Charter contains high level details about is to analyse and document the interests, involvement, the project objectives, scope, timescales, and budget. interdependencies, influence and potential impact on The Project Charter also gives the Project Manager project success. authority to plan and execute the project. Appropriate tools will be used to carry out the analysis A draft outline Project Charter is contained in Annex B. and documentation, this will result in the main inputs The contents of this when it is finalized will be based on: that are required for the Stakeholder Management process. • The deliverables that are being delivered in the study being undertaken by the World Bank. An initial list of stakeholders is presented in Section 0. • Decisions made immediately following the completion of the study by the World Bank about key aspects of the project. • A workshop to be held to specifically complete and agree the project charter. 106 Part 2: Draft Master Project Management Plan 3 Project Planning Phase This section describes the processes involved in carrying out the planning phase of the project management activities, as illustrated in the diagram below. Figure 20. Project Planning Phase A Develop Project Management Plan B.1 Approach to Scope Management This project is a major IT project. It is vital to manage This is the process of defining, preparing, and co- the scope of major IT projects in order to prevent “scope ordinating all of the various project related plans creep” affecting deliverability, budget, and timescales. The (described below) and integrating them into one majority of major IT procurement project failures around comprehensive Project Management Plan. the world have been caused in one way or another by This document is the draft version of this Project scope creep. Management Plan. It will need to be added to The project scope will be managed through the project continually as part of the planning phase of the documents, reviews, and change control processes project. The contents will be based on: established throughout the project’s phases. • The results of this study work being carried out by The project will be managed to ensure that the project The World Bank once reviewed by Government scope baseline is maintained and consistent. Project • The Project Charter documents will be reviewed to ensure the scope as established in the Project Charter, Feasibility Study • Any additional specific management or statutory Report, and in this Project Management Plan is not requirements identified by Ministry of Regional inadvertently altered or changed. The project scope will Development, Ministry of Transport, Information primarily be managed through the project’s scheduled Technologies and Communications, Ministry of reviews in regular meetings including Project Status/ Finance or RIA Progress Meetings, Contractor Meetings, and Steering Committee Meetings, and through the change control process. Communication will play a key role in scope B Plan Scope Management management. The project will establish several forms of verbal and written communication described in the The processes for management of project scope will project Communication Plan to ensure stakeholders, be defined in separate document – the Scope sponsors, executive management, team members, Management Plan. This is important since it ensures external agencies, and Contractors involved in the project that the project includes all work required and only have a clear understanding of the project scope. There the work required to successfully deliver the desired are so many elements that could affect a project’s scope results. Defining the scope means identifying what within a project that the very nature of scope dictates that is and what is not included in the project. its management is integrated in all aspects of the project. 107 Part 2: Draft Master Project Management Plan B.2 Work Breakdown Structure (WBS) The project uses Microsoft Project as a tool to integrate, monitor, manage, and control the overall project The WBS is a multi-level breakdown of the work to be schedule. The overall project schedule will be baselined executed by the project team, to accomplish the project and any changes or variations to the schedule will be objectives and create the required deliverables. The reflected and captured in Microsoft Project, and can be WBS organizes and defines the total scope of project. viewed using the Tracking GANTT view function in the The WBS subdivides the project work into smaller, more application. The Project Scheduler will assess schedule manageable pieces of work. impacts on a regular basis, monitor the progress, The project work breakdown structure is provided in and identify areas where the schedule is or may fall Annex A. behind. The Project Scheduler will bring any items that potentially impact the schedule’s critical path to B.3 Formal Acceptance of Scope the Project Managers’ attention. The Project Scheduler will use Microsoft Project to continually re-assess the The formal acceptance of the project scope is to be project’s critical path and recommend actions to avoid accomplished through the Project Charter. The Project schedule slips or mitigate impacts. Charter will be prepared and submitted by the Project Manager and the Project Director. The charter will be The schedule will follow a formal change control process distributed and coordinated through the Project Sponsor for any proposed changes to the schedule. The change and executive management staff with final approval by control process for the project schedule is described later the Project Director. in this document. A draft version of the Project Charter is contained in Annex B. D Plan Cost Management This process is to develop a Cost Management Plan with C Plan Time Management the objective of ensuring that the project team and its contractors will complete the project within budget. Cost This includes the processes required to accomplish timely management also includes analysis of options and issues completion of the project. This is achieved using to determine the potential effect on the project’s budget a schedule. The Time Management processes include: and operations. • The development of the schedule (using Microsoft Project) The project Cost Management Plan will be provided as a separate plan and addresses how project cost will be • Management of the schedule including changes planned, structured, and controlled for the project and • Monitoring, controlling, and reporting on the schedule identifies the cost management processes and tools to be throughout the project life cycle. used. The Time Management Plan of the project centres on the overall project schedule. The project used a top- down approach to develop the project work breakdown structure that was used as the foundation for the E Plan Quality Management development of the overall project schedule. The project This process is to develop a Quality Management Plan consists of the following major parts as shown in the work that will define, measure, and improve the quality of the breakdown structure, Annex A. project’s processes and products in order to fulfil the success criteria. Quality management establishes the These major parts were then broken down further into processes by which project products and processes must the major activities that make up each of these parts. With adhere to specified requirements and established plans the exception of the Project Contractor Development throughout the project life cycle. activities, all the major activities were broken down into subordinate activities and finally down to the task level. The project Quality Management Plan will be provided as a separate plan that describes how the necessary A combination of bottom-up (analysis of tasks) and top- quality policies will be implemented and how the down (setting the major milestones dates and constraints) project management team plans to meet the quality approach was taken to establish the durations depending requirements set for the project. on the activity, task, or dependency. Through several iterations and alignment of activities and tasks, the overall The Project Contractor will provide a Quality Management project schedule was produced and established. The Plan for their portion of the project as a deliverable Project Schedule is presented in Section 0. product of the contract. 108 Part 2: Draft Master Project Management Plan F Plan Human Resources Management I Plan Procurement Management This process is to develop a Human Resources This process is to develop a Procurement Management Management Plan that identifies the processes and Plan that identifies the activities to be performed or procedures used to manage people throughout the initiated by project staff to manage, track, amend, and project’s life. The plan describes the planning and close a contract. Contractor activities and activities acquisition to the team of both state staff and consulting performed by other state organizations are discussed staff and describes the responsibilities assigned to each at a high level only to facilitate an understanding of the staff. complete process. The project Human Resources Management Plan will be The Project Procurement Management Plan will be provided as a separate plan and addresses the how staff provided as a separate plan and describes the approach acquisition, training, tracking, and management will be and processes to be used for procurement management. managed and controlled for the project. This will need to take account of Government requirements in addition to any constraints imposed by the Public Procurement Law in Bulgaria. G Plan Communication Management This process is to develop a Communication Management Plan that includes processes by which project information J Plan Stakeholder Management is developed, maintained, and managed for both internal This process is to develop a Stakeholder Management Plan and external project stakeholders including the public and that includes processes for identification of stakeholders road users. An initial list of stakeholders is presented in and their needs/interest/influence on the project and Section 0. how stakeholder engagement and communication will be managed and controlled. The project Communication Management Plan will be provided as a separate plan and describes the The project Stakeholder Management Plan will be approach and processes to be used for communication provided as a separate plan and describes the approach management. and processes to be used for stakeholder management. H Plan Risk Management This process is to develop a Risk Management Plan that includes processes by which potential threats to project success are identified, allocated, mitigated, or eliminated. Risk considerations will include technical, management, procurement, performance, budget resources, political, natural disasters, security etc. Risk management is an integral part of project management from project initiation through project completion. The project Risk Management Plan will be provided as a separate plan and describes the approach and processes to be used for risk management. 109 Part 2: Draft Master Project Management Plan 4 Project Execution This section describes the processes involved in carrying out the execution phase of the project management activities, as illustrated in the diagram below. Figure 21. Project Execution Phase A Direct and Manage the Project Work C Acquire, Develop and Manage the Project The Project Management Plan execution will be initiated TEAM through a project Kick-Off Meeting. The Project Kick- Off Meeting provides the forum to integrate all parties C.1 Acquire the Resources involved in the project and focus everyone toward a This is the process of confirming human resource common set of project objectives. The objective of availability and obtaining the team necessary to complete the kick-off meeting is to provide background and an the project activities. The resources will be required that: overview of the project, and to establish a common • Have the correct skills and competences for each role set of management processes and procedures that the project will use to execute the project through • Are sufficient to satisfy the resource levels identified in implementation. Completion of this meeting the Human Resource Management Plan constitutes the formal execution of the Project • Are made available at the right time Management Plan. The Project Management Plan will continue to be C.2 Develop the Resources executed throughout the project through the established In addition to acquiring the project team, it may be processes and procedures documented in the various necessary to develop competencies, team member management plans developed by the project Team interaction, and the overall team environment to achieve and the project Contractor. The project Manager is a strong and motivated team. Processes will be used to responsible to monitor the execution of the plan and will achieve this objective. use status meetings, reports, and project metrics to ensure that the project management plan is being executed. C.3 Manage the Resources The various meetings and reports are described in the These are the processes required for management of the project Communication Plan. team members in terms of performance, resolving issues, managing conflict and providing feedback. B Perform Quality Assurance This is the process of ensuring that appropriate quality D Manage Communications standards are used and applied. This is achieved The Project Communication Plan describes how by auditing of quality requirements and quality information communication will be executed for the measurements. project. The Manage Communications process is the 110 Part 2: Draft Master Project Management Plan process of creating, collecting, distributing, storing, F Manage Stakeholder Engagement retrieving, archiving, and ultimately disposing of project information in accordance with the Communication Plan. This is the process of communicating and working with The objective being to achieve efficient and effective stakeholders to meet their needs/expectations, address communications between project team members and issues as they occur and achieve appropriate levels of with project stakeholders including the public and other stakeholder involvement in the project at appropriate road users. times during the project life. It will be carried out in accordance with the Stakeholder Management Plan and the Communications Management Plan. E Conduct Procurements This is the process of procurement including preparation of procurement documentation, preparation of tender evaluation processes and criteria, management of the procurement activities, selecting the winning tender(s), award of contract(s) and management of the contract(s) including management of changes. The process will be executed in accordance with the Procurement Management Plan which will be in accordance with the Public Procurement Law in Bulgaria. 111 Part 2: Draft Master Project Management Plan 5 Project Monitoring and Control This section describes the processes involved in carrying out the monitoring and control phase of the project management activities, as illustrated in the diagram below. Figure 22. Project Monitoring and Control Phase A project monitoring and control process is necessary for • Action Item Tracking System identifying and controlling factors that create changes • Risk Database Tracking System to make sure those changes are beneficial, determining • Deliverable Tracking System whether a change has occurred, and managing the approved changes when they occur. The two major performance metrics to be reported are cost and schedule. The cost is to be tracked in terms of variances to the approved budget and spend plan. The A Monitor and Control Project Work schedule is to be monitored in terms of variances to the This is the process of tracking, reviewing and reporting on established baseline. progress in terms of budget, time schedule, and scope. It is a continuous process that continues through the B Validate and Control Scope planning, execution and closing project management phases as shown in the diagram above. Validation of the scope is the process of formally ensuring that project deliverables comply with the Monitoring includes collecting information, measuring agreed scope of the project. This will be achieved performance, and reporting on project information, through the use of appropriate processes for and assessing measurements and exceptions. Control requirements capture, requirements documentation, and includes determining corrective or preventive actions and verifying requirements traceability. following up on action plans to determine whether the actions taken resolved the issue. Although the objective is to have little or no change to the project scope, some changes should be anticipated. Monitoring and Control will be carried out in accordance In the event that scope changes occur, the changes with the processes defined in the Project Management will be identified through the Change Control process Plan. The processes will include performance reporting. established in the Scope Management Plan. As changes The project performance reporting will be accomplished to technical and business requirements, hardware, through established status meetings, reports, and internal software, documents, and system design are identified, project tracking systems. The following are a list of the impact to the project’s scope will be assessed and mechanisms used that provide performance reporting: addressed during the formal Change Control process. • Project regular Status Meeting Scope changes will be classified as internal or external, • Project Contractor regular Status Meeting and project-level or management-level. The following • Monthly Steering Committee Meeting defines what constitutes an internal versus external scope change: • Project Monthly Status Report • Internal Scope Change. Change that is generated or • Monthly Project Status Report results within the project organization and structure • Contractor Monthly Status Report within Government. Examples are changes in business 112 Part 2: Draft Master Project Management Plan policies, RIA/Ministry policies, functionality, technical Approval, through the Change Control Process described design, resources, etc. in the Scope Management Plan is required to change the overall project budget and/or baseline. • External Scope Change. Change that is generated or results from entities external to the project organization and structure. These changes may be generated or result E Control Quality from external control agencies, legislation, court orders, This is the process of monitoring and responding State mandates and policy, public sector, or environment. to results of the execution of quality management Both the Project Team and the Project Contractor will activities including recommending necessary changes/ identify any potential internal scope changes. Any external corrective actions. The process will use a set of operational scope changes will be identified through the Executive techniques to verify that the delivered level of quality Steering Committee and the Project Manager. meets the project quality requirements. The process will be carried out in accordance with the C Schedule Control project Quality Management Plan. The project schedule will be monitored, tracked, and controlled by the Project Scheduler. The Project Scheduler will establish and maintain the overall project schedule F Control Communications using Microsoft Project. Once the final project schedule This is the process of controlling project communications is established and approved, the baseline will be set. such that the information needs of the project team and Progress and schedule changes will be tracked against the stakeholders are met. baseline to identify variances. The process will be carried out in accordance with the As part of the time management process and procedures, project Communication Plan. the Project Scheduler will use established forums within the project to manage the project schedule. The following will be utilized to monitor and track the project schedule: G Control Risks • Regular project Team Status Meetings This is the process of controlling risks through the • Regular project Team/Contractor Status Meetings implementation of risk response and mitigation plans, • Contractor Monthly Status Reports monitoring residual risks and identifying new risks as the project progresses. • Daily communication (as required) The process will be carried out in accordance with the All potential impacts to the project schedule must be project Risk Management Plan. reported (verbally or written) to the Project Scheduler prior to a schedule slip occurring. Only activities and tasks on the overall project schedule must be reported to the H Control Procurements Project Scheduler. This is the process of controlling procurements through Project Schedule change requests must be submitted to the management of procurement relationships and the Project Scheduler and include the following: contracts to ensure that the subject of procurement is • The activity/deliverable/milestone impacted successfully delivered by the procurement activities. • How and why the change is being requested The process will be carried out in accordance with • Alternatives to meet the original end date RIA, Ministry of Regional Development, and Public • Revised end date procurement Law requirements which will be defined in • Action plan to meet the revised end date the Project Procurement Management Plan.. Approval, through the Change Control Process described in the Scope Management Plan is required to change the I Control Stakeholder Engagement overall project schedule and/or baseline. This process is for monitoring and controlling overall project stakeholder relationships and for amending plans D Control Cost for engaging with stakeholders as necessary in response to the effectiveness of the relationships or changes that This is the process of monitoring and controlling the occur as the project progresses. status of project costs and managing changes to the cost baseline. It will be carried out in accordance with the Cost The process will be carried out in accordance with the Management Plan. Project Stakeholder Management Plan. 113 Part 2: Draft Master Project Management Plan 6 Phase Close-Out and Lessons This section describes the processes involved in carrying out the closing phase of the project management Learned activities, as illustrated in the diagram below. Figure 23. Phase Close-Out Phase Phase Close-Out and Formal Lessons Learned are project B Administrative Closure management activities performed at the end of each life cycle phase to ensure the proper closure of a current life The Administrative Closure is the process of preparing cycle phase before proceeding to the next phase. Close- closure documentation of the project deliverables as well out activities include review of all goals and objectives as taking other administrative actions to ensure that the of the phase, final status and closure of issues and risks project is closed and its assets are redistributed. related to the phase, and review of documentation and • Financial Closure and Audit. Completing and files for archival or destruction. terminating the financial and budgetary aspects of the project being performed. • Soft Copy of Documentation. Archiving- creating and A Contract Close Out storing a hard and/or soft copy of all documentation The following close out items will be performed by the related to the project. project office: • Personnel and Facilities. Reassignment and reallocation • Contract Final Reports of personnel and equipment that have been used during the project. • Contractor Evaluation • Archiving Contractor Records • Lessons learned A.1 Conducting Formal Lessons Learned At the close of each life cycle phase, the project prepares a lessons learned report. This includes an analysis of project objectives achieved during the completed phase. Lessons Learned reports will be used for identifying areas for process improvement action and for use by other projects to ensure that valuable knowledge and experienced gained can be effectively reused. 114 Part 2: Draft Master Project Management Plan 7 Project Schedule task and milestone are presented later in this section. The numbers in the diagram refer to the Work Breakdown This section describes at a high level “helicopter view” the Structure numbering sequence of tasks and milestones. project schedule for delivery of the toll collection systems and services in Bulgaria. The Work Breakdown Structure is This schedule assumes that a Special Purpose Entity presented in Annex A together with a table listing each is required for all aspects of tolling procurement and task. A more detailed Microsoft Project based project issuing penalties for enforcement, as well as overseeing schedule can be found in Annex C. the Contractor as discussed in the Deliverable section The diagram below shows the logical sequence of the on procurement. If this is not required, the overall go live main tasks needed to deliver the e-tolling and e-vignette timelines do not change as this Entity is not on the critical system together with the main milestones. They are path for delivery as an enforcement body will still need to shown roughly in a time sequence from left to right. These be trained. Annex D contains a revised schedule should are described below. The more specific timings of each this entity not be required. Figure 24. Project Schedule Flowchart The milestones indicated along the timeline at the bottom The main activities and products are: of the diagram shows that the plan enables the following • Planning for and subsequent preparation of tender achievements: documents • Award a Contract for the provision of the necessary • Legal changes to enable e-tolling and e-vignette systems and services – March 2017. • Legal changes to establish the Special Purpose Entity • Commencement of toll collection using e-tolling for Heavy vehicles – February 2018. • Contractor implementation of e-tolling and e-vignette systems • Commencement of e-vignette operations for Light Vehicles – July 2018. • Contractor delivery of operational services for the duration of the contract • Commencement of enforcement operations and contract monitoring by a Special Purpose Entity or other • Handover of enforcement facilities to the Special body – February 2018. Purpose Entity 115 Part 2: Draft Master Project Management Plan The World Bank study will be complete by the end of When the first two of these tasks are complete, it is then October 2015. After that it is essential that two tasks possible to start the procurement process (shown in (shown in green) are started immediately: yellow). It has been assumed that this process cannot be • Decisions to be made. This task is for Government to started until the necessary legislative changes have been make final decisions on the main issues that are identified made. However it has been assumed that the legal stages in the World Bank study that need to be resolved. Without required for introduction of the Government Special these decisions it is impossible to proceed. Purpose Entity can be continued in parallel with the procurement process. • Planning for preparation of the Tender Documents and Project Management. This task is for the project team to The Masterplan is based on the assumption that the plan and organize the tasks needed to deliver the tender Bulgarian Government very quickly makes an agreement documents (but not the documents themselves) and to to carry out the next Stage of project development put in place all of the necessary project management without a public procurement tendering process. To documentation (as described in the Master Project Plan). achieve the objective of start of toll collection in early Later tasks deliver the contract documents themselves. 2018, there is no other realistic option for the Bulgarian Government. If they use public procurement procedures Both these tasks need different actors and so can be for the next Stage then this will introduce a delay of a undertaken in parallel. minimum of 6 months into the Masterplan programme. As part of the preparation of Tender Documents it will be After the procurement stage, a contract is awarded and necessary to capture requirements from a wide range of implementation commences (shown in orange). During stakeholders. In particular, as described in Deliverable 1 the implementation stage there are two main milestones: there are many potential benefits to be obtained by close co-operation between the e-tolling/e-vignette systems • Commencement of toll collection using the e-tolling and Intelligent Transport Systems (ITS). system Therefore during this phase of activity it will be necessary • Commencement of toll collection using the e-vignette to work closely with the organizations involved in the system development of ITS in Bulgaria such as ITS Bulgaria, These have been separated in time since the e-tolling to ensure that data and information flows and system should start as early as possible and the e-vignette architecture considerations are addressed and the full system should commence at a time that makes the benefits can be obtained in the future. During this phase transition between the existing vignette scheme and it will be necessary to analyze the implementation plans the e-vignette scheme possible and convenient for road for ITS to identify when particular functionality may be users. Since the existing sticker vignette scheme includes required. Government has already begin to discuss the annual vignettes, a plan will be required to phase out the project with ITS Bulgaria for example. sales of these so that no annual vignettes will be sold for When both of these tasks are complete the three main the period beyond the commencement dates of both activities (shown in blue) can be started: the e-tolling and e-vignette systems. • Preparation of Tender Documents. This is a major task Eleven months for implementation by a Contractor is that involves a broad range of parties with the necessary tight but feasible provided a near off the shelf system skills and experience of preparing such documents. It also is specified and this has been achieved on projects in involves the stakeholders since it is necessary to identify Europe. The reasons for staggering the implementation and capture their requirements for inclusion in the tender of ETC and e-vignette as above gives reduced risk. documents. Concurrent implementation produces a much higher • Legal changes for enabling e-tolling and e-vignette. peak load on the Contractor at go live (dealing with all This is a sequence of tasks to identify and make the Bulgarian users, not a subset). Introducing e-vignette first necessary legislative changes to enable e-tolling and has a higher initial load for less revenue, and deals with e-vignette to be used for charging for the use of roads customers who unlike heavy vehicles are not used to in Bulgaria. There will also be some legislative changes tolling and will require more time. needed to support the introduction of a Government The e-vignette system is shown as starting in July Special Purpose Entity if it is decided to be required. 2018, so the plan must enable the phasing out of • Legal Stages for the establishment of a Government sticker vignettes to match this date. The planning of Special Purpose Entity. These are the legal tasks necessary this requires consultation and coordination with those to implement legislation to introduce the Special Purpose responsible for management of the existing sticker Entity if required. vignette scheme. 116 Part 2: Draft Master Project Management Plan It has been assumed that the Special Purpose Entity (if Also not shown is connections with the Bulgarian ITS required) will need time to implement in terms of staffing, master plan to check alignment of the tender documents offices and facilities (shown in purple), and that a period with opportunities this shows. of training is required before the Entity can commence The diagrams below present the following: enforcement activities and contract monitoring which must both start at the same time as the e-tolling system • Overall Project Schedule showing the main tasks and goes live in February 2018. milestones To avoid over complication of the diagrams, not shown • More detailed tasks and milestones for changing on the project schedule are the project management legislation to support e-tolling and e-vignette tasks which include management of communications • More detailed tasks and milestones for the legal tasks with stakeholders. This will be vitally important to ensure associated with the establishment of the Special Purpose that road users, haulage companies and other important Entity if required stakeholders such as vehicle hire companies, receive sufficient warning about the project and obligations of • More detailed tasks and milestones for the procurement road users and how this will affect their businesses. process Also not shown are the tasks necessary to achieve a Annex C contains the detailed Microsoft Project smooth transition between the existing vignette scheme Gantt chart on which these diagrams are based. and the new e-vignette scheme. This will entail a phasing Annex D contains a revised schedule should this not out of the existing vignettes to match the implementation be required. plan of the new e-vignette scheme. Figure 25. Main Tasks and Milestones 117 Part 2: Draft Master Project Management Plan Figure 26. Legislation to Establish an SPE Figure 27. Change of Legislation for ETC and e-vignette 118 Part 2: Draft Master Project Management Plan Figure 28. Procurement Process 119 Part 2: Draft Master Project Management Plan 8 Project Governance and B Project Organizational Structure Organization Structure The following is a list of internal and external organizations impacted by the project. • The Special Purpose Entity, if adopted A Governance Plan and Issue Escalation Process • RIA The Governance Plan identifies the key governance roles • Ministry of Regional Development and responsibilities for the project and covers who by role, • Ministry of Transport, Information Technologies and is responsible for: Communications • Approving project documents, • Ministry of Finance • Establishing contracts in support of the project, • Customs • Approving Contractor deliverables, • Police • Making the final decision to accept the system and • Road users including individuals, freight companies, Contractor products. vehicle hire companies, emergency services and national The Executive Steering Committee is the primary entity organisations such as the Army within this project guiding the governance processes. The • Media Issue Escalation Process identifies the governance and escalation process that will be used to manage issues, The proposed project organisation structure is shown problems, change, or approvals. in the Figure 29, this must be validated, and participants The project Governance Plan and Issue Escalation from the relevant organisations need to be identified at an Process will be provided as a separate plan and describes early stage of the project. the approach and processes to be used for project governance and issue escalation. Figure 29. Proposed Project Organization Structure Executive Steering Project Project Project Management Assurance Manager Office (PMO) Project Teams Team Managers 120 Part 2: Draft Master Project Management Plan The roles and responsibilities are as follows: Senior Supplier Executive Steering Committee The Senior Supplier advises on the technicalities of the project; including method, design, and strategy. They The Executive Steering Committee is appointed by the are the product specialists - they approve the product corporate/ programme management to take overall descriptions and represent those who are designing the direction of the project. The Executive Steering Committee product, developing it, operating and maintaining it. The should be made up of managers with the authority to Senior Supplier has the authority to utilise any resource commit resources to the project within the limits set by needed to achieve the final product. They exercise quality the corporate/programme management. control and must ensure that any operating standards are As the public face of the project, the Executive Steering defined and achieved. They will need to be able to brief Committee is responsible for any publicity of the project other management staff on the technical aspects of the and dissemination of information. The Executive Steering projects. Committee agrees all major plans and should authorise Here are the definitions of the rest of the project any important changes to the agreed Stage Plans. management team: On completion, each stage is signed off by the Executive Steering Committee which then must authorise the start Project Manager of the next stage. Any conflicts within the project or The Project Manager works on behalf of the Executive between the project and external bodies are negotiated Steering Committee to manage the ongoing project to by the Executive Steering Committee. agreed specifications and tolerances. They make sure the The Executive Steering Committee approves the final product is as agreed, to the required standard and appointment of the Project Manager and any delegation within time and cost budgets. They are also responsible for of their responsibilities. Ultimately, the Executive Steering ensuring the product will lead to the benefits outlined in Committee is responsible for the assurance of the project, the business case. that it remains on course to deliver the desired outcome of the required quality to meet the Business Case defined Team Managers in the project contract. The Team Managers reports to the Project Manager but Responsibilities of specific members of the Executive have responsibility to ensure the product is delivered in Steering Committee are described below: the time and budget specified. They will directly manage the project team and are responsible for motivating and Executive monitoring their ongoing work. The executive has ultimate responsibility for the success Project Assurance of the project; that it gives ROI and that the demands of the business, user, and supplier are balanced. They will Executive Steering Committee members are not a part appoint people to the roles of Senior User, Senior Supplier, of the project full time and so place a lot of reliance on and Product Manager, will chair meetings, and conduct the Project Manager. They may assign Project Assurance briefings throughout. The Executive will closely monitor functions to ensure that the project is meeting its aims. ongoing progress and changes to the project plan; Project Assurance is in place to give the board members and will eventually approve the notification of project confidence that they are being given accurate reports on closure once satisfied that it is completed within agreed the progress of the project and the expected quality of the budgetary and scheduling tolerances. output. The task of project assurance is given to individuals from the Executive Steering Committee, but not the Senior User project manager or any of the core project team. The Senior User specifies the needs of those who will Project Management Office use the product and monitors to ensure the solution will meet those needs. Their place on the board is to represent Project support is provided by the Project Management the interests and requirements of the users as a whole. Office and is driven by the needs of the project and the Sometimes the role may be shared, to cover different Project Manager. It can take the form of advice on project user interests, but splitting the role between too many management tools, administrative services including people risks losing effectiveness. The Senior User will document management, data collection, project ensure that any testing has the appropriate user-focus and reporting, and monitoring including monitoring of the representation. schedule and financial aspects of the project. Annex A: Work Breakdown Structure 122 Annex A: Work Breakdown Structure The diagram below shows the logical sequence of the The table following the diagram shows all of the tasks and main tasks needed to deliver the e-tolling and e-vignette milestones contained in the Project Schedule in a WBS system together with the main milestones. The numbering format. of each main task shown in the diagram is the Work Breakdown Structure (WBS) numbering used in the Project Schedule. Figure 30. Work Breakdown Structure WBS Task Name 1 World Bank Study 2 Decisions to be made 3 Preparation of tender documents 3.1 Preparatory work for tender documents 3.2 Preparation of tender documents 4 Legal Changes for enabling e-tolling and e-vignette 4.1 Preparation of bill for the amendments / new ordinance and justification by the initiator of the change (Ministry level) 4.2 Public consultations 4.3 The author (Minister) of the draft sends to the concerned institutions and organizations for coordination 4.4 Correction to the initial draft 4.5 Submission to the Council of Ministers 4.6 For the secondary legislation - it can be submitted for promulgation in State Gazette by the CM. The bill for amendment of the Law shall be submitted to the Parliament. 4.7 Submission to the Parliament 4.8 Discussions in the parliamentarian commissions 4.9 First plenary reading 4.10 Second round of discussion at parliamentarian commission level 4.11 Second plenary reading 123 Annex A: Work Breakdown Structure 4.12 Promulgation in the State Gazette 4.13 Necessary legal changes completed 5 Procurement Stage 5.1 Document preparation by Contracts Department 5.2 Tender announcement 5.3 Tender responses 5.4 Evaluation Committee 5.5 Decision 5.6 Bidders informed 5.7 10 calendar day waiting period for bidder appeals 5.8 Resolution of Appeals 5.9 Ruling of Appeal 5.10 One month period in which higher level appeal can be submitted 5.11 Resolution of higher level appeal 5.12 Final decision 6 Legal arrangements for establishing a Special Purpose Entity (if required) 6.1 Preparation of the bill and justification for the amendments by the sectorial minister 6.2 Public consultations 6.3 The author (Minister) of the draft sends to the concerned institutions and organizations for coordination 6.4 Submission to the Council of Ministers 6.5 The bill for amendment of the Law shall be submitted to the Parliament. 6.6 Submission to the Parliament 6.7 Discussions in the parliamentarian commissions 6.8 First plenary reading 6.9 Second round of discussions at parliamentarian commission level 6.10 Second plenary reading 6.11 Promulgation in the State Gazette 6.12 Implementing of the Bill 6.13 The establishing of the company after the adoption of the changes has two aspects - organizational and legal. 6.14 Registration with the Trade Registry 6.15 Special Purpose Entity becomes operational 7 Preparation of Special Purpose Entity 7.1 Recruit senior staff 7.2 Find offices 7.3 Establish office and recruit staff 8 Contract 8.1 Award of Contract 8.2 Implementation Stage for e-tolling 8.3 Go Live of e-tolling 8.4 Implementation Stage for e-vignette 8.5 Go-Live for e-vignette 8.6 Operational Stage by the Contractor for one year 8.7 Training of Special Purpose Entity 8.8 Handover operations to Special Purpose Entity In addition to the above main tasks, there are several • Stakeholder liaison and communication tasks including other global tasks that run throughout the period of dialogue with road users, provision of advanced the project including for example: information, road user education etc. • Project and Quality management tasks Annex B: Draft Project Charter 125 Annex B: Draft Project Charter Project Project Charter Version No.<#> Prepared By: Date of Publication:
Table of Contents PROJECT OVERVIEW............................................................................................................................................................................................................................ 126 Background.............................................................................................................................................................................................................................................. 126 Purpose....................................................................................................................................................................................................................................................... 126 Description............................................................................................................................................................................................................................................... 126 Pre-Project Documentation:.......................................................................................................................................................................................................... 126 PROJECT TEAM AND STAKEHOLDERS...................................................................................................................................................................................... 126 Project Team............................................................................................................................................................................................................................................ 126 Stakeholder Groups............................................................................................................................................................................................................................ 127 PROJECT SCOPE.................................................................................................................................................................................................................................... 127 In Scope:..................................................................................................................................................................................................................................................... 128 Out of Scope:.......................................................................................................................................................................................................................................... 128 Project Deliverables Planned:....................................................................................................................................................................................................... 128 PROJECT ESTIMATES (SCHEDULE & COST)........................................................................................................................................................................... 129 PROJECT BUDGET................................................................................................................................................................................................................................ 129 PROJECT ASSUMPTIONS AND CONSTRAINTS.................................................................................................................................................................... 129 PROJECT ASSUMPTIONS.................................................................................................................................................................................................................. 129 PROJECT CONSTRAINTS................................................................................................................................................................................................................... 129 PROJECT RISKS....................................................................................................................................................................................................................................... 129 PROJECT DECISION-MAKING......................................................................................................................................................................................................... 129 PROJECT APPROVALS:........................................................................................................................................................................................................................ 129 126 Annex B: Draft Project Charter B1. Project Overview Description This section presents an overview of the reasons why this The project objective is to commence electronic toll project is being carried out. collection for heavy vehicles operation in early 2018 which will ensure that toll revenue will flow to the State for the use in maintaining roads. Background At the request of the Bulgarian Government the World Pre-Project Documentation: Bank carried out a feasibility study between March and October 2015 for the introduction of electronic toll • World Bank Deliverable 0 collection in Bulgaria. • World Bank Deliverable 1 The outcome of the study was that a project should be • World Bank Deliverable 2 initiated immediately in order to deliver the necessary systems and operations capability to achieve electronic toll collection by early 2018. B2. Project Team and Stakeholders Purpose Project Team The road network in Bulgaria suffers from insufficient Describe the Project team composition; roles, funding for maintenance and upgrade. The study carried accountabilities; organizational realities; interfaces; out by the World Bank identified that implementation of communication plan; plan-to-plan; project notebook electronic toll collection for heavy vehicles and electronic composition; post-project review positioning. vignette system for light vehicles would close the funding gap and enable sufficient funding to be achieved to To be completed during the Project Planning improve the maintenance of roads in Bulgaria. Stage. Role Name Title Phone Sponsor: Project Manager: Subject Matter Experts: : : : : : : 127 Annex B: Draft Project Charter Stakeholder Groups Describe the stakeholder groups for this project. What do they expect and how do you plan to communicate with them? To be completed during the project planning stage. Group Name Expectations Specific Requirements Communication Method : : : : : B3. Project Scope • Procure one or more Contractors to design, customize, test, implement and carry out operations to deliver the The scope of this project includes the following items: project objectives • Collect tolls from users/owners of vehicles with >3.5T • Ensure the Purchaser’s organization and staff are maximum permissible gross vehicle weight using prepared for the project implementation an electronic free flow tolling system on a defined toll road network in Bulgaria • Decommission the existing vignette system in a phased manner • Collect payments from users/owners of vehicles with < 3.5T maximum permissible gross vehicle weight using an • Complete the post Implementation and Evaluation electronic vignette system for vehicles travelling on Report a defined road network in Bulgaria • Decommission the existing physical vignette system The scope of the project does not include: • Providing functions outside those required The detailed scope of the project is to: • Collection of tolls on roads not defined as being within Secure and retain project approval and funding the toll road network • Define requirements for the project The technical scope of project that is the subject • Ensure Verification and Validation, and Project Oversight of this Project Charter is shown in Figure 31 are performed below. 128 Annex B: Draft Project Charter Figure 31. Technical Scope of the Project For vehicles  mplementation and Operation of an • I Electronic Toll Collection System with MPGV Decommissioning of the existing vignette •  W>3.5T system For vehicles • Implementation of an E-vignette system with Decommissioning of the existing vignette •  MPGVW<3.5T system In Scope: Objective Success Criteria Judge Commence electronic toll collection Toll revenue to be collected, cost of Executive Steering Committee for heavy vehicles in early 2018 operations, level of compliance by users Commence electronic vignette for Vignette revenue to be collected, cost Executive Steering Committee light vehicles in mid 2018 of operations Out of Scope: Project Deliverables Planned: • Toll collection or electronic vignette operation on roads The following main deliverables/products are planned for other than those to be defined as part of the toll road delivery in this project. network Deliverable/Product Approver Quality Expectation Date Due Tender Documents Executive Steering Committee Compliance with Public 1 September 2016 Procurement Law Commencement of operation Executive Steering Committee Compliance with Contract Early 2018 of an Electronic Toll Collection Documents System Commencement of operation Executive Steering Committee Compliance with Contract Mid 2018 of an electronic vignette system Documents 129 Annex B: Draft Project Charter B4 Project Estimates (Schedule & Cost) B8. Project Constraints To be completed during the project planning stage. The major constraints facing the project are: • The requirement to commence toll collection for vehicles >3.5T maximum permissible gross vehicle weight B5. Project Budget by early 2018 To be completed during the project planning stage. • The Public Procurement Law and the procedure for procurement • The need for a credible, efficient and cost effective B6. Project Assumptions and Constraints enforcement body or bodies In order to identify and estimate the required tasks and timing for the project, certain assumptions and premises • Obtaining funding for each major stage of the project need to be made. Based on the current knowledge • The EU Directive regarding the European Electronic Toll today, the project assumptions are listed below. If an Service (EETS) in terms of interoperability requirements assumption is invalidated at a later date, then the activities and estimates in the project plan should be adjusted accordingly. B9. Project Risks Project risks are circumstances or events that exist outside of the control of the project team and will have an adverse B7. Project Assumptions impact on the project if they occur. In order to execute the project and accomplish the project To be completed during the project planning stage. objectives within the time constraints, the following assumptions are made: • Necessary legislative changes are achieved according B10. Project Decision-Making to the project schedule The Project Manager has the following authority with • The necessary project team resources are established respect to: in accordance with the project Resource Plan • Hiring & Firing (staff acceptance) – • The project governance structure is established and functions efficiently making decisions quickly in order • Budgetary Decisions – to avoid delays • Technical Decisions – • Risk allocation is done in an optimal manner • Conflict Resolution – allocating risks to the organization best placed to manage them To be completed during the project planning stage. • The potential Contractor (or Contractors) has Beyond these levels of authority, the path of escalation is a developed system that contains the majority to the executive Steering Committee. of the components to satisfy the business requirements. • All relevant stakeholders will be properly engaged B11. Project Approvals: in accordance with the project Communication Plan. To be completed during the project planning stage Annex C: Project Schedule 131 Annex C: Project Schedule Annex D: Program without Special Purpose Entity 133 Annex D: Program without Special Purpose Entity 134 Annex D: Program without Special Purpose Entity Part 3: Financial Analysis 136 Part 3: Financial Analysis 1 Introduction A The Structure of Deliverable 3 B Targets for revenue This is Part 3 of Deliverable 2 of the project for The net levels of net revenue targeted were researched “Development of a Comprehensive Vision for the and defined in Deliverable 1 as at least 400 Mio BGN per Introduction of the Electronic System for Provision of the annum. However, this must be achieved: European Electronic Toll Services”. • Without diversion of traffic to free unsuitable roads due The background to the project is given in Part 1 of to elasticity in payment of tolls this Deliverable 2, while part 2 contains a Master • Fairly, with a minimum of impact on users both private Implementation Plan. and in fleets This Part 3 meets the Terms of Reference requirement for • With a minimum of risk analysis of the financial impact for the introduction of the system on road infrastructure projects already approved • Flexibly, for example with the ability to fine tune tolling and in progress (financed by the EU Cohesion Fund), with rates or roads covered a view to possible revenue generation. Hence this report examines many scenarios for example It addresses the following ToR requirements: of reduced e-tolling and e-vignette rates to minimize impact, and different road networks. We present these • Identification of national routes or road sections for as options for government choice taking other factors which it will apply. such as public acceptability into account, rather than a • Development of a preliminary financial model (flows of single option. These can then be used for Government to investment / costs / revenues, distribution of assets and make trade-offs of light and vehicle prices and network liabilities, rules and frameworks for payment, etc.) coverage. • An estimate of revenues from the toll collection by classes of network and categories of vehicles for a period of 5-10 years • Development of preliminary financial plan for a forecasted / anticipated period of return on investment in terms of developing the electronic system for the provision of EETS 137 Part 3: Financial Analysis 2 Financial Model Architecture This chapter describes the financial model to evaluate with the project in its future Stages (e.g. procurement revenues and costs for strategic options chosen in and implementation). At this Stage the financial model deliverable 1. The objective is to provide evidence of developed contains 33 matrices (i.e. multi-dimensional revenues and costs for the further deployment of a tables), about 300 equations and 9.5 Mio. input and solution for e-tolling and e-vignettes in Bulgaria. output cells. The tools used allow efficient scenario development and Figure 32 shows the architecture of the modelling ad hoc “what if” analysis, while still being flexible to grow environment that has been adopted. Figure 32. Financial Model Architecture The left side of the diagram (orange area) shows the client The financial model has a geodata centric modelling side data provision, while the right side (violet) shows the approach. That means that each revenue and cost World Bank systems involved in the financial modelling. item is whenever practical broken down to actual road Data and information flows between the client and the sections. Each road section is linked through a distinct World Bank systems. These provide: ID to geographical vector data for mapping on any Geographical Information System (GIS). • Analysis (data, network, existing best-practice in e-tolling and e-vignette systems, etc.), As shown in the figure, all data is run through a SQLite database1 with the Spatialite extension2 to ensure data • Synthesis (system and operational concept with revenue consistency and quality. Dedicated data analysis and generation and cost modelling assumptions, etc.) and synthesis is done using software packages such as MS • Processing (geodata generation, data queries, financial Excel, Quantum GIS (QGIS)3 and others. modelling and processing, etc.) 1  QLite is a relational database management system contained S lightweight DBMS SQLite to process GIS and spatial data: in a C programming library. In contrast to many other database https://en.wikipedia.org/wiki/SpatiaLite, https://www.gaia-gis.it/ management systems, SQLite is not a client–server database gaia-sins/index.html engine. Rather, it is embedded into the end program: https:// 3 Q  GIS (previously known as “Quantum GIS”) is a cross-platform en.wikipedia.org/wiki/SQLite, http://sqlite.org free and open-source desktop geographic information system 2  patiaLite is a software extension under a MPL GPL LGPL S (GIS) application that provides data viewing, editing, and tri-license (i.e. open source) that enables the well-known analysis capabilities: http://qgis.org/en/site/ 138 Part 3: Financial Analysis The financial modelling and business planning activities and All qualitative and quantitative results are available in processing are then done using a relationally structured, either a text report or in standard data format such as MS multi-dimensional modelling software called “Quantrix”4. Excel or comma separated value (CSV) files. The system enables “hyper-cube oriented” large data and multiple scenario modelling, processing and analysis. 3 Financial Model A Modules • Vignettes, The financial model consists of the following modules: • System Cost and Operational Assumptions, • Traffic, • Revenue and Cost Processing, • Road Network, • Results. • Pricing (weight and emissions), Figure 33 shows the structure of the financial model and • Vehicles, the modules with data flows Figure 33. Financial Model structure 4  urther information about the system can be found at: F http://www.quantrix.com/en/products/quantrix-modeler/ 139 Part 3: Financial Analysis B Traffic Module: • Traffic to GDP elasticity for heavy (factor = 1) and light vehicles (factor = 1.25)9. The traffic module is one of the core modules of the financial model. The most recent comprehensive traffic The NUTS 2 regional factors10 used are: count data is for 2010 as described in Deliverable 1. • BG31: 0.50 These have been combined with some additional data available for the years 2011 to 20145 in order to • BG32: 0.70 estimate average annual daily traffic (AADT) traffic counts • BG33: 0.90 for 2015. Based on these estimates the AADT for the • BG34: 1.10 years 2016 to 2027 is forecast6 using an estimate for the • BG41: 1.20 Bulgarian Gross Domestic Product (GDP) of 2.5%7 • BG42: 0.90 which is: • Adapted for regional differences with regional GDP Figure 34 shows the geographical distribution of the factors (adopting the NUTS2 structure8) and NUTS2 regions and regional GDP factors. Figure 34. Regional GDP Factors Used to Modulate the Bulgarian GDP Estimate Per NUTS2 Region 45 5 All available traffic data was provided by RIA.  8  See: http://ec.europa.eu/eurostat/web/nuts/overview. 6  he forecast is carried out in the model in two parts as T 9  hese elasticity values are estimates based on expert local T the emission split was added at a later stage. Overall the knowledge in Bulgaria. methodology is as described here. 10 T  hese regional factors are the ratios between the GDP 7  his value was agreed between the project team and the T growth in the regions between 2007 and 2012 and the national Bulgarian Government. one. 140 Part 3: Financial Analysis The equation used to estimate the AADT 2016 to 2027 is, •  traffic to GDP elesticity being a correlation between GDP and traffic development, •  emission ratio being the split ratio for AADT based on vignette data (see Vignette Module). for each road section with Based on the geo information received from RIA, new motorway constructions (as new sections) have been • t being the time index 2016 to 2027, added (motorways constructed and opened in 2015). We • region being the index to the NUTS2 regions, have been informed by the Ministry that no other major •  vehicle category being the index for light and heavy projects should be taken into account in the near future vehicles, and that is subject to e-tolling. • ø  GDP being the average gross domestic product for The estimated AADT per section has been totalled by Bulgaria, year and e-tolling network scenario. Figure 35 shows the •  gdp Faktor being a factor accounting for regional GDP process and data resources used to estimate AADT 2016 differences, to 2027. Figure 35. Traffic Estimation Process 141 Part 3: Financial Analysis Traffic diversion induced by the introduction of e-tolling Motorway + 1st class roads: –  has been taken into account as follows:  rucks ≥ 12 tons: diversion initially 7% and after –T From pricing changes in the current vignette system 3 years approx. 2% introduced in the year 2013, it is evident that commercial  rucks < 12 tons: diversion initially 20% and after –T truck users are very sensitive to pricing changes and will 3 years approx. 5% adopt the most economical solution for their transport needs. In an e-tolling scheme, many users will pay Motorway + 1st + 2nd class roads: –  substantially more than for a vignette. These users will be  rucks ≥ 12 tons: diversion initially 3% and after –T keen to use the most economical routes and will divert to 3 years approx. 0% non tolled roads where possible. The diversion is highly dependent on the e-tolling rate structure and pricing  rucks < 12 tons: diversion initially 10% and after –T levels and the availability of suitable evasion routes. 3 years approx. 3% In absence of data about Bulgarian user behaviour with Motorway + 1st + 2nd + 3rd class roads: –  the introduction of e-tolling but based on e-tolling  o diversion because there are hardly any roads – N experience in other countries we have implemented the suitable for trucks following diversion logic: Figure 36 shows the estimated total traffic (in total • We assume that diversion will be higher initially but kilometres driven per year) for each road network decreases asymptotically (in other words flattens out) to a scenario divided by the emission classes with assumed residual diversion percentage within the first few years, as traffic diversion with the introduction of e-tolling in 2018. users get used to e-tolling. Traffic diversion results in a drop in traffic with the • In the road network scenarios defined, we assume introduction of e-tolling on different road network that larger trucks are less likely to divert to lower class combinations. As visible in figure 36, the highest relative roads because of vehicle characteristics and diminishing drop in traffic numbers will be in a motorway + 1st class economic benefit. road scenario. In absence of effective alternative routes • Thus, in the model we assume the following values per suitable for trucks, we anticipate no substantial diversion network scenario: in a motorway + 1st + 2nd + 3rd class road network scenario. Figure 36. Traffic (Total Annual km Driven) Per Network Scenario Divided by Emission Classes Figure 36 also shows the trend to “cleaner” vehicles through differential pricing (“cleaner” vehicles pay less) realised through the current vignette and kept in an e-tolling scenario. 142 Part 3: Financial Analysis C Road Network Module: Through the section IDs and NUTS categorisations, further data such as information about the road conditions The road network module contains the geo-referenced and maintenance, economic indicators or other socio- (based on section IDs) road data categorised into road economic indicators can be directly linked to e-tolling or classes, regions, NUTS2, NUTS3, lane numbers and section e-vignettes. lengths. At present, the road database contains the current The table in Figure 37 shows the structure of the road road network including roads under construction and to network module data and a few rows of data as an be finished in 2015. example. Figure 37. Road Network Data Table D Pricing Module: Prices increase with the weight of the vehicle. –  • 60% of GOV recommended rates (av. BGN 0.12)”: This module holds the baseline rates tables for e-tolling As a second scenario, we have modelled gross e-tolling and the e-vignettes. The pricing module is linked to the revenue with 40% lower rates as compared to the revenue and cost processing modules. government recommended rates but with the same Based on discussions with the government, three e-tolling pricing structure. pricing scenarios have been implemented: • “130% of GOV recommended rates (av. BGN 0.26)”: • “GOV recommended rates (av. BGN 0.2)”: This is As a third scenario, we have modelled gross e-tolling the e-tolling baseline scenario based on Government revenue with 30% higher rates as compared to the recommended e-tolling rates and an average price of BGN government recommended rates but with the same 0.2 per kilometre with the following structure: pricing structure. – C  leaner vehicles (EURO II – V and better) pay less than The table in Figure 38 shows the three e-tolling pricing dirtier vehicles (EURO I – II). scenarios and e-tolling rates by vehicle type, road, and emission class in BGN.  otorway and 1st class roads are more expensive – M except for heavy and articulated trucks which pay more for 3rd class roads. 143 Part 3: Financial Analysis Figure 38. E-tolling Rates Table As discussed with RIA and recommended for Ministerial Two e-vignette pricing scenarios have been approval, the pricing strategy suggested is that heavy and implemented articulated trucks are charged a flat rate for motorway, 1st • “e-vignette rate option 1”: In this e-vignette scenario, a and 2nd class roads but a higher rate for 3rd class roads rather high price increase for the annual e-vignette (from to encourage them to use roads better suited for heavy 67 BGN to 150 BGN) but the same pricing as the current weight vehicles. weekly and monthly vignettes is modelled. Buses, Small Trucks and Medium Trucks pay the same rate • “e-vignette rate option 2”: In this e-vignette scenario, for motorway and 1st class roads, while paying less for 2nd the annual vignette price is only moderately raised and 3rd class roads. from the current level (from 67 BGN to 97 BGN). The These principles are kept while varying the tariffs in three same pricing is kept for the current weekly and monthly rating scenarios. vignettes. Ways of detecting and classifying these vehicles on the The table in Figure 39 shows the two e-vignette, pricing road are detailed in Part 1. scenarios and rates in BGN. Figure 39. E-vignette Rates Table Compared to international e-tolling and e-vignette compare to other toll domain rates (green means lower practices (data taken in April 2015) the Bulgarian rates rates, red higher rates). Note that Germany has recently for all scenarios modelled are in the lower half. Figure 40 reviewed its rates. and Figure 41 give a tabular overview how Bulgarian rates 144 Part 3: Financial Analysis Figure 40. International Comparison of e-tolling Rates In the “GOV recommended rates (av. BGN 0.2)” scenario, In the “130% of GOV recommended rates (av. BGN 0.24)” rates in the Hungarian and Slovakian toll domains would scenario, Austria and Hungary still would have significantly be higher and rates in Poland and the Czech Republic higher rates. would be lower. In the “60% of GOV recommended rates (av. BGN 0.12)” scenario, only Poland would have slightly cheaper rates. Figure 41. International Comparison of e-vignette Rates In the “e-vignette rate option 1” scenario, Romania would vehicle numbers (cars, commercial, buses and articulated have lower vignette rates overall and Slovakia would have tractors) from 2015 to 2027. lower annual rates. Every other toll domain including All data received through official Bulgarian sources Slovenia and Hungary has higher vignette rates. was cross-checked with data available through In the “e-vignette rate option 2” scenario, only Romania Eurostat11. would have lower rates. Figure 42 shows the historic and forecasted vehicle numbers divided into passenger cars, commercial E Vehicles Module vehicles, buses and articulated vehicles12. Interestingly, in 2006 vehicle numbers were corrected to lower A time series for domestic registered vehicles for the years figures. The forecast is done linearly based on the historic 1995 to 2014 is available and used to extrapolate future data available. Note that the y-axis is logarithmic. 12 T  hese categories do not exactly match those used in the current vignette scheme and the proposed e-tolling scheme, 11 http://ec.europa.eu/eurostat/web/transport/data/database but were suitably close for modelling purposes. 145 Part 3: Financial Analysis Figure 42. Vehicles Numbers (Historic and Forecast) F Vignette Module Current vignette usage data (domestic and border sales) • Category 1: Trucks ≥ 12 tons is available as time series ranging from 2010 to 2014. • Category 2: Trucks < 12 tons The data is used to model e-vignette numbers for light vehicles (i.e. passenger cars) for the years 2015 to 2027. • Category 3: light vehicles i.e. passenger cars The current vignette sales distinguished by vehicles category, vignette type and emission classes are shown in Figure 43: 146 Part 3: Financial Analysis Figure 43. Vignette Unit Sales The current pricing of the vignettes and the revenues are shown in Figure 44 and Figure 45, respectively. 147 Part 3: Financial Analysis Figure 44. Vignette Prices in BGN 148 Part 3: Financial Analysis Figure 45. Vignette Revenue in BGN The vignette sales at borders – shown partly in Figure 46 – are used to estimate foreign vehicle activity and model GNSS box (i.e. “On-Board Unit (OBU)”) numbers for e-tolling. 149 Part 3: Financial Analysis Figure 46. Vignette Border Sales in 2013 (Some Border Crossings Only) Figure 47 shows the time series data for current light e-vignettes sales as used in modelling the e-vignette vehicles vignette sales and the linearly forecasted revenue. Figure 47. Current and Forecasted e-vignette Units 150 Part 3: Financial Analysis Despite the pricing changes in “e-vignette rate option 1” • Karel Cerny, Electronic toll collection in the Czech and “e-vignette rate option 2”, vignette ratios between Republic., 2009 weekly, monthly and annual e-vignette numbers have In addition, the team has worked on many schemes been kept the same as current vignettes for two reasons: worldwide and have peer reviewed the costs assumptions • There is no user behaviour data with the introduction based on their experiences. of e-vignettes13 or any time series where the pricing between the vignette types changed, but The data is used to calculate Capital (Capex) and Operational (Opex) expenditures for current best-practice • pricing changes introduced for heavy vehicles in 2013 – e-tolling and e-vignette systems. Relevant e-tolling see figures 44 and 45 – resulted in different distributions national free-flow systems in Germany, Hungary, Slovakia, of weekly, monthly and annual vignettes but the overall Poland, Switzerland and France14 were evaluated. gross revenue figure including the trend has not changed much. Relative figures for Capex and Opex were derived as Therefore, in absence of user behaviour data (1) but given functions of network size, vehicle population and annual the fact of (2) we assume the resulting gross revenue kilometres tolled as shown in the equations (1) and (2). for e-vignettes over time can plausibly be estimated multiplying linearly forecasted e-vignette numbers with prices despite the pricing changes and changes in the e-vignette type ratios. G System Cost and Operational Assumptions Module Capexrelative , Opexrelative and transaction cost for This module includes a table with cost of existing e-tolling e-vignettes and routes passes and each network scenario and e-vignette systems. All data in the table is validated is shown in Figure 48. This table shows that average Capex through published reports and official sources such as but per kilometre for scenarios (b) and (c) are respectively 60% not limited to: and 30% of the average Capex per kilometre for scenario • Hegner R. et. al., St. Galler Mautstudie, 2013 (a), these relative rates are not too low, because there are scale effects: experience elsewhere, in particular in • Demerlé R., Thinking Highways, Vol. 6. No. 4, 2012 Slovakia, shows that marginal cost when adding network • Bundesamt für Güterverkehr (BAG), Mautstatistik 2013 decreases significantly. Figure 48. Capexrelative, Opexrelative and Transaction Cost for e-vignettes and Routes Passes and Each Network Scenario (a) m + 1st (b) m + 1st + 2nd (c) m + 1st + 2nd + 3rd Cost (BGN) Average Capex existing and comparable 1 116 443 69 866 34 933 systems per tolled network km without OBU 2 Average Opex existing and comparable 0.0451 0.0406 0.0361 systems per annual tolled km 3 Transaction Cost per e-vignette 2 2 2 4 Transaction Cost per transit route pass 4 4 4 13  user behaviour survey was beyond the scope of this A 14  lthough the France Ecotaxe system was not made operational A project. it was nevertheless fully built and tested. Capex and (planned) Opex figures are available. 151 Part 3: Financial Analysis  vignette: the current vignettes are considered to – e have a relatively high proportion of non-compliance. There is no evidence or data but it is assumed that The most important operations assumptions15 are: 30% of revenue is currently lost for weekly and monthly vignettes. With better enforcement for • Prices for GNSS boxes i.e. “On-board Units (OBU)” and e-vignettes and with enforcement synergies through average lifespan: given the trend of current e-tolling OBU e-tolling it is assumed that 70% of that lost revenue prices and the availability of “off-the-shelf” components including smartphone and App based approaches can be gained. For yearly vignettes zero loss due to recently announced, we assume an average OBU price of non-compliance is assumed because users buy EUR 100 for the operation of the e-tolling scheme and an these for a year anyway. Given the revenue ratios average lifespan (or MTBF) per OBU of 5 years16. for vignettes in 2014 (annual, monthly and weekly), overall about 2% of revenue lost due to • Foreign Users and OBU use. We anticipate a relatively non-compliance in an e-vignette scheme high ratio of route passes (because of the current high [(0.3 – (0.3 x 0.7)) x 0.22 = 0.0198; numbers of daily vignettes used for foreign vehicles). In 0.22 is the weekly & monthly revenue ratio case foreign users acquire an OBU we assume that 30% of from overall]. Given international experience this these will return the next year. result is plausible. • Fleet Management. We anticipate the use of data from fleet management units (i.e. GNSS points as a “snail trail”)  oute-passes: route-pass revenue is a function – r substituting normal OBUs for data acquisition. We assume of distance driven. The route-passes are just an alternative means to collect the distance-based – 70% of articulated trucks and revenue (not using an OBU). Thus non-compliance is – 20% of commercial vehicles modelled in combination with e-tolling. will use fleet management data instead of OBUs.  -tolling: non-compliance for e-tolling is assumed – e • E-vignette. Based on the data we assume that about to be at 5% initially decreasing (exponentially) to 2% 30% of current possible vignette gross revenue is lost within the first years of operation. due to non-compliance (from potential weekly and  nforcement effectiveness and hence increase of – E monthly vignette revenue) and 70% of that lost revenue compliance rates over the 10-year period was built can be regained through e-vignettes in combination into the financial modelling of options as described with rigorous enforcement (using synergies with e-tolling above. enforcement). t was not considered necessary to conduct sensitivity – I • Non-Compliance and Enforcement. We assume that analysis with respect to compliance-rate (enforcement initial non-compliance in an e-tolling scenario will be effectiveness) over the 10-year period because non- about 5%, declining in a steady state operation to 2% compliance at 5% will not have a significant impact through the combination of stationary and mobile enforcement. A more detailed discussion of some of on overall revenue. If non-compliance is much higher the non-compliance and enforcement assumptions is as e.g. high double digit range the e-tolling enforcement follows: and the e-tolling operation as such has an operational problem.  t system start, the non-compliance rate is expected – A to be quite high and that rate will decay over time with  ith non-compliance rates below 10% none of the 18 – W enforcement. options will have negative NPVs. – N  on-compliance was modelled for each of the 18 Figure 49 shows the relationships and data flows in the options: module to derive relative capex and opex figures. 15 T  here were other minor assumptions not listed here which 16  here is a small error in the model in the estimation of the T have insignificant effects on the results, including a 10% number of OBUs required for buses and tractor units for growth rate per year in route passes and growth rate of articulated lorries, but the effect is insignificant: the error foreign vehicle GNSS boxes of 3% per year. affects the total costs by less than 1% and this effect is less than the potential variability in OBU price. 152 Part 3: Financial Analysis Figure 49. System Cost and Operational Assumptions Module H Revenue and Cost Processing Module In this module, all data and pre-processed figures from This should however be done as part of a more detailed other modules are aggregated to estimate revenue and business plan at the next stage of the project. cost for three different pricing and three different network scenarios. The following equations are used for revenues: The cost for OBUs largely depends on the vehicle population influenced by the three network scenarios. Hence, the costs are a function of those values which have been estimated in other modules for the years 2015 to 2027. The capital expenditures (Capex) for design and Revenues for e-tolling are estimated per section as a building the systems (i.e. e-vignette and e-tolling) are function of the three network scenarios and three pricing largely dependent on network size, system costs scenarios. Revenues for e-vignette are estimated based on (i.e. capexrelative and opexrelative) and operational vehicle population and vignette pricing. assumptions. Revenues from penalties are not considered tolling Figure 50 shows the network scenarios and pricing revenues, and revenues from penalties have not been scenarios (e-tolling and e-vignette) as they influence the modelled separately during this stage. result processing in the cost and revenue module. 153 Part 3: Financial Analysis Figure 50. Revenue and Cost Processing These impact annual kilometres driven (and tolled) on the RIA road network. The annual kilometres driven are estimated for the years 2016 to 2027 based on AADT data from the traffic module. Operational expenditures (Opex) for e-vignettes depend on the vehicles population as established in the vehicle module and vignette module as time series, in combination with parameters from the system cost and assumptions module. Operational expenditures (Opex) for route passes are based on the extrapolated current border crossing data (i.e. vignette sales at borders) in combination with parameters from the system cost and assumptions module. Operational expenditures (Opex) for e-tolling depend on Costs associated with violation detection and enforcement the three network scenarios. (e.g. via MEU personnel) are included in the Opex. 154 Part 3: Financial Analysis 4 Results A Overview Using a rather high discount rate of 7% the NPV of the net revenues give a very conservative view of achievable Each of the three network scenarios agreed in deliverable Government income through the introduction of 1 is presented, as well as three e-tolling pricing scenarios electronic tolling. and two e-vignette scenarios as a check of sensitivity to rate changes. It would be a good practice to subject the NPV analysis to variation in cost of capital (assumed a constant at 7%), In each scenario, e-tolling and e-vignette operation starts This could and should be done at the next stage when from the first year of operation in 2018. Operational costs a detailed business plan model is required. The current of e-tolling and e-vignette including revenue flow start model is for strategic planning. in 2018 and last until 2027. The year 2017 is anticipated Undiscounted gross revenue, cost and net revenue is as the build year within which most of the capital shown as an alternative, “raw” representation of the results. expenditures (Capex) will occur. It is a rather optimistic view on achievable Government For each scenario the results are presented as: income introducing electronic tolling, as an upper limit of revenue achievable for the 18 options. • Net Present Values (NPV) of net revenues is given discounted to the year 2017 using a rate of 7% which A complete business plan including a cash flow analysis is conservatively covers the cost of finance, and beyond the scope of this strategic report. • Undiscounted gross revenue, cost and net revenue for All result figures are given in Bulgarian Lev (BGN). the implementation year (i.e. Capex to design and build the system), cost (i.e. Opex) and the resulting net revenue available from the e-tolling and e-vignette schemes. B Net Present Values (NPV) The NPV method of showing financial results is taking Figure 51 shows the net present values (NPV) for each of into account risk by discounting future net revenue. the total 18 scenarios. Figure 51. Net Present Values of the 18 Scenarios Evaluated The baseline NPV values range from about 2.7 Billion BGN In a “60% of GOV recommended rates (av. BGN 0.12)” to 10.1 Billion BGN over ten years of operation depending scenario, the NPV based average yearly net revenue on a combination of network size and rating scenarios for would range from about 270 Mio. BGN to 466 Mio BGN e-tolling and e-vignettes. depending on the e-vignette rate options and the network size. Hence they would not all meet the target. In the NPV calculation with “Government recommended Allied to the above this suggests some flexibility on rates is rates (av. BGN 0.2)”, regardless of the e-vignette rate possible if later required. options and the network size, the average yearly net revenue would always be well above the target 400 Mio. In a “130% of GOV recommended rates (av. BGN 0.24)” BGN ranging from 435 Mio. BGN to 776 Mio. BGN. scenario, the NPV based average yearly net revenue would 155 Part 3: Financial Analysis range from about 560 Mio. BGN to 1 Billion BGN depending on the adopted procurement model will be spent and on the e-vignette rate options and the network size. financed by an operator. Depending on the procurement and operational model adopted by the Government the Capex may be paid back as a lump sum in the first year or it C Gross Revenue, Cost (Capex and Opex) and may be spread over the operational period (or part of it) and Net Revenue paid through operator remuneration. C.1 Results Furthermore, the tables show the first and last year of operation with total revenues (divided into e-tolling and Figure 52 and Figure 53 show tables providing a view on e-vignette revenue), operational cost (i.e. Opex, divided the gross revenue, cost and net revenue situation for each into e-tolling, e-vignette and route pass) and the net of the 18 scenario combinations evaluated.17 revenue available from electronic tolling. Figure 52 shows 9 options with e-vignette option 1. The operational cost/revenue ratio is an indicator for Figure 53 shows 9 options with e-vignette option 2. the “efficiency” of scheme (revenue vs cost). Based on international experience it should be less than 0.20 but The tables show the initial investment for the design and usually around 0.15. building of the e-tolling and e-vignette systems in the year 2017. These values (Sum of Cost in 2017) can be considered the initial capital expenditure (Capex) which depending C.2 E-vignette Option 1 Figure 52. Gross Revenue, Cost and Net Revenue (implementation, 1st and last operational year) for the Three Network and e-tolling Rate Scenarios and e-vignette Rate Option 1 in Mio. BGN 17 M  ore details e.g. figures for each year of operation are provided in the actual financial model available to the Government in fully electronic form. 156 Part 3: Financial Analysis C.3 Discussion of Outcomes with Option 1 class roads” would reach almost 1.5 Billion BGN in the last year of operation (2027). Except for combination of e-tolling scenario “60% of GOV The net revenue available in the first year of operation recommended rates (av. BGN 0.12)” and road network (2018) ranges from 513 Mio. BGN in the “60% of GOV scenario “m + 1st + 2nd + 3rd class roads” in all scenarios with recommended rates (av. BGN 0.12)” and “m + 1st class e-vignette rate option 1 – figure 52 – the electronic tolling roads” scenario combination to 1.5 Billion BGN in the schemes would essentially break even in the first year of “130% of GOV recommended rates (av. BGN 0.26)” and operation. In other words the Sum of Cost in 2017 = Initial “m + 1st + 2nd + 3rd class roads” scenario combination. Capex is less than net revenue in 2018. All exceed the 400Mio .BGN target. In the “GOV recommended rates (av. BGN 0.2)” scenario net revenue in the “road network scenario m + 1st + 2nd + 3rd C.4 E-vignette Option 2 Figure 53. Gross Revenue, Cost, and Net Revenue (implementation, 1st and last operational year) for the Three Network and e-tolling Rate Scenarios and e-vignette Rate Option 2 in Mio. BGN 157 Part 3: Financial Analysis C.5 Discussion of Outcomes with e-vignette 2 roads” or “road network scenario m + 1st + 2nd + 3rd class roads” this small “profit” after break-even would be actually In an “e-vignette option 2” scenario combination –net larger than the current total revenue from the existing revenues overall are about 105 Mio. BGN lower compared vignette scheme in 2014. to “e-vignette option 1” scenarios. That is because of the lower annual rate modelled for light vehicles’ e-vignettes. Nevertheless, the “GOV recommended rates (av. BGN 0.2)” D Results Geo-referenced to Bulgarian Roads scenarios still show good net revenue for the first year and NUTS2 Regions of operation. In that scenario, the investment into the Figure 54 and Figure 55 show example results – net electronic tolling schemes could still break-even in the present values (NPV) of total revenues – geo-referenced first year of operation (Sum of Cost in 2017 = Initial Capex on the RIA road network and cumulated for the Bulgarian is less than net revenue in 2018) and there would still be a NUTS2 regions. small “profit” left from electronic tolling. This is to show the potential of using the results in In the scenario combination “GOV recommended rates (av. combination with a GIS for visualisation and decision BGN 0.2)” and “road network scenario m + 1st + 2nd class support. Figure 54. NPV by Road Section Using Baseline Tariffs in BGN values in BGN 158 Part 3: Financial Analysis Figure 55. Net Present Value Example of Total Revenue from e-tolling on RIA Road Network (Motorway + 1st + 2nd + 3rd Class Road Network) Cumulated by Bulgarian NUTS2 Regions, Values in BGN BG31 | 1.0 Bn values in BGN BG33 | 1.2 Bn BG32 | 1.2 Bn BG34 | 2.0 Bn BG41 | 2.4 Bn BG42 | 1.9 Bn The motorway network (both existing and to be finished • Traffic flows. Based on available traffic counting a traffic in 2015) shows most of the revenue ranging in the NPV model was developed. Expected traffic was forecasted value range above 150 Mio. BGN (see figure 54). using a combination of GDP growth, regional GDP, GDP The road corridors from Sofia to the south east (to to traffic elasticity and diversion of traffic due to pricing Turkey) and to the north east but also to the south sensitivities. A rather conservative approach to traffic show the highest total NPV from e-tolling. Otherwise, growth based on GDP was adopted. All traffic data is the NPV values of e-tolling revenue are quite evenly section based and geocoded to be used in combination distributed with some concentration at major Bulgarian with a GIS for visual representation. cities. The NUTS region 41 (including Sofia) shows • Capital Expenditure (CAPEX) for the system. This has the highest cumulated NPV revenue from e-tolling, been established using a range of benchmarked evidence followed by the NUTS region 34 as shown in the from other schemes but will only be proven once a Figure 55. Contractor submits a price. We will refine this as the design matures and through supplier engagement. However, as E Discussion on Sensitivity of Results the Capex is typically less than one year’s revenue, even doubling the cost will not change the NPV markedly. The financial model is a tool for option evaluation. At this Stage it is not a pricing or revenue prediction • Costs of on board units. We have assumed current model nor a business plan with cash flow analysis. costs plus a conservative mix of fleet management units, but trends in costs continue to fall. Our OBU costs are The areas of sensitivity are: therefore conservative. • Toll rates for e-tolling and for e-vignettes. These have • Operational Expenditure (OPEX) for the system. This been explicitly explored by vehicle type, road type and is between 14% and 29% of the revenue and again based emission class (e-tolling distance based) and by e-vignette on benchmark with other recent systems. This is conserva- type (time based). Emission class splits have been chosen tively priced and will be refined in the next Stages. to reflect current data and penalise the “dirtiest” vehicles using Bulgaria’s roads. Although these are relatively few, Overall and based on a combination of 18 scenarios, all a premium is still suggested to encourage movement to figures suggest robust revenue streams can be achieved, cleaner vehicles. As new emission classes are introduced, even as costs are estimated. The true cost will only be new classes can also be set up to further encourage known at the end of the tender/build phase and provided adoption of these vehicles. the correct toll tariffs are charged and enforced. 159 Part 3: Financial Analysis There are also many other factors affecting the F Summary of Options against Targets sensitivity of the overall NPV, including traffic flows and equipment prices. These need to be reviewed Making the target net revenue across 10 years and as new data becomes available, However, the overall allowing for costs of borrowing etc means an NPV based target revenue is in most cases greatly exceeded, approach gives a more robust overview. The following giving a buffer of additional revenue over the target to table shows average NPV in Mio BGN against the 400 Mio accommodate any changes in costs or traffic. BGN target (Shown in green if greater than 400 or red if less). 60% of Recommended 130% of recommended rates recommended rates rates Option 1 for e- vignette (150 BGN per annum) Motorway plus 1st class roads 343 512 639 Adding second class roads 412` 663 851 Adding third class roads 465 776 1001 Option 2 for e-vignette (97 BGN per annum) Motorway plus 1 class roads st 266 435 562 Adding second class roads 336 586 774 Adding third class roads 389 700 932 This shows the trade-off between light and heavy • A high e-vignette price with lower heavy vehicle charges, and road coverage. The key is that the target charges, but with additional roads charged for heavy cannot be met unless: vehicles • A low e-vignette price is combined with A low e-vignette and low heavy vehicle price will not give recommended heavy vehicle rates, although not the revenue required. However, revenues can be increased all the network needs to be charged for heavy in the life of the scheme by adding extra roads into the vehicles; or charged network and/or increasing rates. 160 Part 3: Financial Analysis 5 Conclusions The following general conclusions may be drawn: to be as low as for example Poland would reduce revenue but still give substantial net revenue. • All 18 strategic scenarios deliver good returns on investment, most exceeding the notional 400 Mio. BGN • This means there is some room for manoeuvre of rates if target for annual net revenue, even when using a rather required later. conservative NPV method. Most pay off the Capex • Adding class 2 and 3 roads gives additional net revenue, element in the first year. as does increasing rates, but does increase risks to delivery • However, looking at average NPV over the ten years because of the geographic scope of the system and poor suggests the low cost e-vignette plus low cost e-tolling public acceptance. option will not reliably meet this target. Hence either • Through the introduction of e-tolling and maintaining e-tolling or e-vignette charges need to be around the differential pricing between emission classes, the trend recommended level. to “cleaner” trucks will continue. Especially larger trucks • Good returns can be achieved by using e-tolling rates (weight ≥ 12 ton) will almost completely converge to for heavy vehicles that are lower than most comparable cleaner emission classes (EURO III – V+) within the next EU countries in early 2015, and e-vignette rates that are couple of years. At this point, a new emissions rate may be similar to the average across Europe. Reducing the rates needed. European Union