Saving the city
December 14, 2006
City Hall has more than a cash flow problem. Even if they were given the $167M that they are demanding, it will not aid in the recovery process because what is needed at City Hall is a comprehensive reform that would allow the City to be operated as a business enterprise rather than along the same old archaic lines on which it has been administered since colonialism.
I have said before that a deal is needed between the main political parties represented in Parliament. This is not a deal about who should be allowed to become Mayor. Such political agreements would not address the endemic problems of the city. In any event, the main opposition People's National Congress Reform cannot be trusted any more when it comes to deals about the distribution of political power, be it at the central of local government levels.
What needs to be tested is the sincerity of that party to place the interests of the country first. By now the PNCR must be aware that it is the one most likely to be embarrassed by the decline in the city, for the supporters of the government will have a ready-made example of a non-PPP controlled municipality that has gone into terminal decline. It is the PNCR's image that is most likely to be tarnished in the process.
The PNCR therefore has everything to lose if the problems of City Hall are not resolved and the municipality put on a sure-footing. It is therefore to the interest of that party to seek to enter into a joint arrangement with the other parties represented in Council, as well as with the government. In this article, I will outline what I think should be the main planks of this deal.
If no deal can be reached, then the government should consider moving the capital city else where.
The first thing that needs to be addressed is the collection of rates and taxes and the rate at which these rates and taxes are levied. It should be agreed that for the City, the government will move speedily with legislation to replace the general rates and taxes with two sets of rates and taxes.
The first would be a general rate that would be charged on the existing valuations and which would be for the provision of general services such as road repairs, drainage, the maintenance of dump sites and street lighting. There should however be an understanding that eventually the government would proceed with the re-evaluation of all properties within the City and that this exercise be completed within five years, after which rates and taxes would be levied at an adjusted tariff ( either upward or downward). In the interim, there should be a minimum general rate which will have to be paid by all homeowners and businesses, which should be no less than $12,000 per annum.
The second measure would be to institute, again through legislation, charges for specific services to households and businesses for things such as garbage collection and other solid waste disposal. My estimate is that for another $1,000 per business and household, City Hall can contract out for an efficient solid waste disposal service for the City. This would mean that no household in the City should be paying less than $2000 per month, and, even on a fifty per cent rate of collection, this should cover the existing recurrent expenditure of the city, until such time as economic costs for specific services can be introduced no later than January 2008.
The purpose of these measures would be to secure an adequate base for the Council to meet its expenditure and future investment needs.
In order to deal with the poor collection rates, there should be an agreement between the government and the judiciary for the establishment of a civil municipal court that would allow Council to levy on properties in default on their rates and taxes for three or more years. If the arrears are not settled, with the permission of the Courts, Council should move to have these properties sold at forced-sale values and the proceeds used to settle the indebtedness of ratepayers to Council with the remainder going to the homeowner or business. I am confident that when defaulters face the prospect of their properties being sold, they will find ways of settling their indebtedness.
The next step would be to trim the staff at City Hall and cut unnecessary and unproductive expenditure. In order to ensure that this system is fair and free from partisan considerations, I would propose that the government fund a short-term consultancy to come with a leaner but effective management structure, which would help to significantly reduce the high administrative costs presently carried by City Hall.
Tomorrow, I will explain how these administrative costs can be reduced and how the management expenses of City Hall can be made more viable without the need to move towards an Executive Mayorship.