3. Mr Fattydad elaborated that the proposed tunnel link would provide a direct and convenient road access for residents of Discovery Bay (DB) to the new airport and Tung Chung New Town. Apart from providing emergency access to medical facilities, it would also facilitate the transport of fresh water supply to DB. In addition, a sewer would be built in the tunnel as part of the sewage export scheme to transfer sewage from Peng Chau and DB to Siu Ho Wan Sewage Treatment Works, thus improving the quality of surrounding waters. Mr SIU pointed out that with the tunnel link, staff of the Chek Lap Kok new airport could choose to reside in DB for easy access to the airport. It would also provide alternative means of transport other than ferry service from DB to the rest of Hong Kong. DBCOC therefore urged the Bills Committee to expedite scrutiny of the Bill.

4. Mr Howard YOUNG enquired whether the proposed restriction on the use of the tunnel (i.e. no private cars or taxis) was acceptable to DBCOC. Mr SIU replied that DBCOC had reservations in this regard and hoped that the restriction could be lifted at some stage in future. They would request the developer concerned to build car parking facilities near the southern exit of the tunnel.

Hong Kong Resort Company Ltd. (HKR)

5. Mr J C H Marriott said that the Bill should be enacted as soon as possible so that HKR could commence the tunnel project without delay. He also assured that HKR would accede to DBCOCs request for the provision of car parking facilities upon relaxation of the restriction, subject to the Administrations approval.

6. Concerning members question about the toll level for passage of vehicles, Mr Mike Clark advised that taking into account the anticipated traffic flow, a tunnel toll of $20 (in 1995 prices ) per vehicle per one-way trip would be collected in order to recover the estimated operating and maintenance costs of the tunnel.

7. The Chairman commented that a clause should be included in the Bill to ensure that HKR would bear the operating costs of the tunnel without any cross-subsidy. Mr Marriot said that he had no objection to this but was concerned that the amendment might delay the passage of the Bill, and hence the tunnel project. The Chairman assured that as it was likely that there would also be other Committee stage amendments, the passage of the Bill would not be delayed by such an amendment.

8. The Chairman noted that the tunnel link would be built, maintained and operated by HKR at its own costs. He requested information on projections of the tunnels revenue and operating costs. In response, Mr Marriot undertook to provide the relevant report prepared by HKRs consultant in February 1996, but highlighted the fact that the report had not been updated since then.

(Post-meeting note : The requisite information was circulated vide LegCo Paper No. CB(1)1356/96-97 dated 21 April 1997.)

III. Discussion with the Administration

9.The Deputy Secretary for Transport (Dep S for T) remarked that the Administration was in support of HKRs proposed project. He also advised that the construction of the sewerage through the tunnel link would advance the diversion programme of the Outlying Islands Sewerage Masterplan by a few years.

Royalty

10. Responding to members questions on the purpose of charging royalty for the operation of the tunnel link, Dep S for T advised that the royalty was a tax charged by Government in return for permission to use a limited resource belonging to the community, or to operate a service to the public either on an exclusive basis, or with restricted competition. The purpose of charging royalty was to ensure that the general revenue, and hence the public, received a fair share of the financial benefits arising from the use of this limited resource or service. The operation of a tunnel by a private company fell within the scope for a royalty to be charged.

11. Concerning the royalty rate for the tunnel link, Dep S for T elaborated that it was broadly in line with that applicable to the Tates Cairn Tunnel (TCT) taking into account the traffic restriction to be imposed. In this connection, a royalty of 2.5% of the gross operating receipts would be charged for the tunnel link commencing from the operating date.

12. As to how the royalty structure of the TCT compared with that of the tunnel link, the Principal Assistant Secretary/Treasury/Revenue advised that in the case of TCT, Government charged a royalty of 2.5% of the operating receipts for a period of 5 years after the road operating date and thereafter 5% of the operating receipts. In addition, Government charged a further royalty of 15% of the net operating receipts in excess of the projected net operating receipts for a period of 5 years after the road operating date and thereafter 30% of the net operating receipts in excess of the projected net operating receipts. As for the DB tunnel link, Government would charge a royalty of 2.5% of the operating receipts commencing from the operating date. If the restriction on the use of the tunnel link was relaxed, Government would charge a royalty of 5% of the operating receipts commencing from the date of relaxation. In addition, Government would charge a further royalty of 15% of the net operating receipts in excess of the projected net operating receipts for the period of 5 years following the date of relaxation and thereafter 30% of the net operating receipts in excess of the projected net operating receipts.

13. Members in general commented that the existing royalty policy for tunnel operation might not be applicable to the tunnel link since there was no precedent for such a tunnel where traffic restriction was imposed. They urged the Administration to further review the royalty structure of the tunnel link. Upon members request, the Administration undertook to provide information on the projected royalty revenues of the tunnel link and those of other tunnels in Hong Kong.

(Post-meeting note: The requisite information with respect to the above and ensuing paragraphs was circulated vide LegCo Paper No. CB(1) 1390/96-97 dated 24 April 1997.)

Land premium & tunnel construction costs

14. In response to members enquiry on the use of unleased land for the proposed project, the Principal Assistant Secretary/Transport (PAS/T) advised that the Lands Department would charge HKR a premium for the construction of the tunnel link on unleased land. He added that Government would bear a portion of the construction cost of the sewerage. Members requested the Administration to provide information on the respective proportion of tunnel construction costs to be borne by government and HKR. As regards whether Government rent would be collected on the leased land of the tunnel, the Administration undertook to provide the information by the next meeting.

Access to North Lantau Expressway and the urban areas

15. On the planning for road network in North Lantau to tie in with the tunnel link, Dep S for T advised that the proposed tunnel link would be connected to the utility service road next to North Lantau Expressway (NLE) for access to the new airport and Tung Chung New Town and that road users could use the Tung Chung Interchange to gain access to NLE for Lantau Link (LL) and the urban areas. He stressed that the proposed arrangement had been discussed and agreed with HKR taking into account the traffic and transport implications of the road network for North Lantau.

16. Members generally considered that there should be a more direct connection between the tunnel link and NLE for access to urban areas. The Chief Transport Officer (CTO) advised that the traffic arrangement was only a temporary measure and that an additional interchange at Tai Ho might be completed in 2011. Furthermore, a future possible connection between the tunnel road and Container Terminal No. 10 at Yam O Interchange could provide access to east bound lanes on NLE as proposed in the North Lantau Development Report. At members request, the Administration undertook to provide detailed maps illustrating the following:

the entire NLE;
the junction between the tunnel link and the utility service road next to NLE; and
the junction between the proposed tunnel road and Container Terminal No. 10, and Tai Ho interchange.

Other issues

17. In view of recent complaints against air pollution in vehicle tunnels, Mr CHEUNG Hon-chung enquired whether statutory control on air quality inside the tunnel should be specified in the Bill. PAS/T advised that the Administration would make regulations to specify details in this respect after enactment of the Bill. CTO supplemented that the Administration would ensure that the ventilation system design would be able to meet the latest air quality standard under maximum traffic flow condition after relaxation of the restriction.

18. In response to the Chairmans question on estimated traffic flows on LFC and NLE from DB by the years 2001 and 2011, the Senior Engineer/Territory Transport Planning Division advised that there would be around 240 and 190 passenger car units per peak hour travelling via LL and NLE to and from the Discovery Bay Tunnel respectively for both 2001 and 2011, with tunnel usage restricted to residential coaches and services vehicles only.

19. In response to the Chairman on whether the toll level for the tunnel link would be subject to approval of the Legislative Council, Dep S for T replied that the matter would be subject to the Administrations approval only, since the tunnel link was privately operated by HKR at their own costs and catered exclusively for residents of DB. He advised that the Administration would liaise with HKR and where necessary consult residents concerned on the toll level.

20. Mr CHAN Wai-yip enquired whether a proposal to establish a toll stability fund as a reserve to be generated from the net revenue would be considered by HKR in the operation of the tunnel link. Dep S for T responded that HKR had such a plan which would enable it to build up a reserve for the maintenance and repair of the tunnel and that the Administration had raised no objection to this proposal. Mr CHAN urged the Administration to liaise with HKR on the setting-up of a toll stability fund for the interest of DB residents. Dep S for T noted his views and agreed to discuss the matter with HKR.

21. Concerning the Chairmans enquiry about the Administrations safeguard against the abandoning of tunnel operation by HKR, PAS/T advised that Government would first consult all parties concerned to determine how best the tunnel operation should be carried on in case HKR failed to fulfil its obligations in operating the tunnel. Despite the fact that the abandoning of tunnel operation by HKR was highly unlikely, the Chairman commented that relevant provisions should be prescribed in the Bill to ensure that the possibility was addressed. The Administration noted his views and agreed to review the matter.

22. Mr Ronald ARCULLI enquired whether licence fees would be reviewed for vehicles confined to DB and North Lantau. The Principal Transport Officer/Transport Operations Division advised that under existing legislation, the Commissioner for Transport might license a motor vehicle for the use in Lantau only, at a prescribed fee lower than the relevant full licence fee. The Administration would consult HKR to work out the level of licence fees for vehicles restricted to the use of road access from DB to North Lantau.

23. Members generally considered it not necessary to include clause 9(6) in the Bill, which stipulated that no compensation should be payable to the Company in relation to the exercise of any power of Government under that section. They were of the view that the interest of Government might be over-protected. Dep S for T assured members that Government would exercise its power in a reasonable manner. After deliberation, he agreed to delete this subclause.

24. Referring to clause 29(3), members were concerned that there might be practical difficulties for the driver of a vehicle to give the name and address of the registered owner of a vehicle being driven. They considered that the provision should be amended to bring it in line with similar provisions in the Tsing Ma Control Area Ordinance. The Administration noted members view and undertook to follow up the matter.

IV. Any other business

25. In order to speed up the scrutiny process, the Chairman urged members to forward questions which they might have on the Bill to the Clerk for onward transmission to the Administration, whose responses would be forwarded to members for discussion by the next meeting.

26. The meeting ended at 4:15 pm.

Legislative Council Secretariat
16 June 1997

Last Updated on 14 December 1998

Bills Committee on Discovery Bay Tunnel Link Bill

Minutes of meeting held on Thursday, 17 April 1997, at 2:30 p.m. in the Legislative Council Chamber

I. Confirmation of minutes of meeting

II. Discussion with deputations

Discovery Bay City Owners Committee