Against the backdrop of an escalating row over paid parking, the Mayor and City Council (M&CC) yesterday announced that property rates will go up by 10% – the first hike since 1998 – and it is projecting an $833M deficit for 2017.
Under the theme “Revitalising Local Communities in the context of a Green Economy,” Chairman of the Council’s Finance Committee Oscar Clarke, told those gathered in the council chamber yesterday that after a process of consultations the city has arrived at budget with revenue estimated at $2.8 billion, while an expenditure of $3.6 billion dollars is projected.
Included in the budget is a slew of new revenue measures including controversial charges for paid parking, container fees, the 10% increase in property rates and several new fees. There was no projection for the revenue from paid parking though a draft budget seen by Stabroek News had assigned a figure of $120m for 2017. The paid parking project has seen a broad boycott since it was launched on January 23rd and yesterday a large protest was held against it outside of City Hall.
The projected $833m shortfall does not include the council’s debt, which totals $2.7 billion, as of September 30. $1.7 billion of that sum is owed to the Guyana Power and Light (GPL).
Over the last 10 years City Hall has recorded deficits in every year except 2009, 2012, 2013 and 2014. 2017’s projected deficit is the highest in this period, exceeding the previous high of $346 million recorded in 2006.
Clarke reminded his audience that the 2017 budget was being presented under a new dispensation of local democracy, and at a time when the council is allowed to exercise its full authority as stipulated in the Municipal and District Councils Act.
He took the time to stress that the council’s revenue base is grossly inadequate and needs to be expanded, while arguing that this inadequacy continues to impede council’s ability to reach out to communities and secure their wellbeing.
As part of its revenue collection, the city has indicated that ratepayers have to face a 10% increase across- the -board on property rates effective from January 1, 2017.
Clarke pointed out that there has been no increase in the percentage assessment of property rates since 1998, while noting that there are a number of unassessed properties both in terms of construction, expansion and change of use.
“Property owners ought to recognise that the rates paid in 1998, based on the size of property then, cannot be applicable now,” Clarke said.
He further explained that the municipality has agreed that in the first half of 2017, it will focus on capturing information as to the number of properties within the confines of the city and their purposes. That time will also be spent processing this data with the assistance of the Chief Valuation Officer and private assessors, determining the new value and applying the current formula to arrive at new rates. After the completion of this process, demand notices will be issued and all means necessary to collect the outstanding amounts will be employed.
Judicial process
Additional measures to be used by council to improve its rate collection include “vigorously engaging in the judicial process to recover all outstanding rates.”
“Council is of the view that it is felt that there is more talk than action in this area, and even when concession is granted, optimum use is not made by those concerned,” Clarke said.
M&CC will therefore in 2017 pursue a Petty Debt Act, Parate Execution and Distraint (seizure of someone’s property in order to obtain payment of money owed) Warrants.
Additionally, council plans to improve its database to include the deletion of properties exempted from collectable rates, update the Tax Register to take account of Domestic Properties used for commercial purposes and design and develop a shared database with other agencies to ensure that property- owners honour their obligation to the city.
Revenue collection at markets is also expected to be improved through the computerisation of the entire revenue collection system for the markets.
“A special technology will be used to capture all those vendors and stallholders who use our service and facilities,” Clarke stated.
Council also plans to implement new fees under the Public Health Act from February 1, 2017. These will affect salons, which include barbershops, hairdressing and other forms of cosmetology.
These unnamed fees are still subject to approval from the council. City Hall has, however, promised as part of its effort in collecting revenue to strengthen its building inspectorate as well as to encourage compliance with laws and regulations.
Burial space
Those seeking to bury their loved ones within the cemeteries maintained by the council will also be expected to from this year pay a maintenance fee in addition to the fee paid to purchase burial space.
Clarke has also promised to initiate discussions with the unions representing council workers to examine jointly new ways of revenue earnings, a stakeholder collaboration, which he stated can only lead to the benefit of both the workers and management, key stakeholders in the process of delivery of services to the citizens.
While the budget presentation was detailed about the areas which will attract new fees, it was less that specific about projects which will account for its $3.6 billion expenditure.
Clarke noted that workers emoluments consume over 55% of the revenue mobilised by council and that in 2017, the employment cost is projected at $1.2 billion dollars. He also explained that council has statutory responsibility for the maintenance of 160 miles of roads, 800 miles of concrete and earthen drains, 12 outfall channels and sluices as well as all parapets, reserves and thoroughfares within the council area.
It also holds primary responsibility for the maintenance and servicing of all bridges, footpaths and other sidewalks, collection and disposal of all waste generated, street lighting, maintenance and control of municipal parks, and public open spaces, maintenance and management of five municipal markets, and maintenance and enforcement of the Building Code, among others.
Day care services are expected to cost $104 million, maternal and child welfare, $53 million, street lighting $23.7 million, markets $406 million, meat, food and hygiene $49 million, public education/communication $10 million, cemetery $73M, employment cost $1.2 billion, administrative services $129 million, security protection and insurance $93 million, general maintenance $73 million, development works $97 million and other provisions $23 million.
For the period August to December, 2016, the council collected $57.9m in container fees following a showdown with the private sector. Clarke said discussions are still ongoing on a final agreement.
On paid parking, Clarke listed a series of positives, aside from the fees, including increased parking availability and reduced congestion, reduction of waste of time and gasoline usage, creation of more than 100 jobs and increased vigilance and security on city streets.
