– plans ‘aggressive’ collection after $600M revenue shortfall in 2008
Chairman of the city’s Finance Committee, Deputy Mayor Robert Williams yesterday presented a $2B budget for expenditure for the capital this year, while announcing that City Hall would aggressively pursue revenue collection.
According to Williams, the municipality has estimated expenditure at $2,199,804,788, slightly over $1.9 billion budgeted last year, while projecting an income of $2,199,805,438 for the year. The city is looking to garner revenue primarily through property taxes ($1.6 billion) and through market fees ($241 million).
This year, significant sums will be spent on employment costs ($989 million), administrative services ($422 million), security protection and insurance ($77 million), equipment, transportation and maintenance ($143 million), general maintenance ($452 million) and development works ($97 million).
Williams yesterday stated that during this year, the municipality will be aggressive in its attempts to secure revenue and added that that the City Council has developed a strategic plan in this regard. One of the methods is the completion and implementation of a new Valuation Roll. According to Williams, properties in the city were assessed back in 2003, on the basis of a new system which not only captured a complete aerial view of the property and other ways but stored each property in a database. This allows for comparison of what has been captured by the council and what is on the ground in reality. This also provides for the properties to be assessed on the basis of a market value as against a rental mode.
He also noted that there has been no increase in the percentage assessment of property taxes since 1998. He explained that this is against the background that there are a number of “unassessed” properties. As a result, the council has agreed that in the first half of the year will be seeking to correct the situation, with Williams emphasising that property owners ought to recognise that the taxes paid in 1998 based on the size of property cannot be applicable now.
According to the Williams, the council has already held discussions with Minister of Local Government Kellawan Lall and Finance Minister Dr Ashni Singh and is awaiting confirmation before beginning this exercise.
Additionally, the council is aiming at improving its revenue collection at the various markets in the city. Williams said that even though much has been done during the last year, he feels that much “more can be collected in revenue from our markets and market related activities.” To aid in this process, the revenue collection system for the markets will be computerised, Williams revealed, and added that the “vendors/stall holders will be treated in a similar way as GT&T/GPL.”
He also announced that from February 15, salons, barber shops and such business will have to adhere to a new fee structure under the Public Health Act. This new structure was approved last November, the Deputy Mayor said. Further, Williams said that the building inspectorate of the council will be strengthened so as to ensure that buildings are in compliance with laws and regulations thereby attracting the necessary processing.
Williams said too that the council will be also approaching international agencies in order to garner support for its activities. It is because of the contribution of one of these international agencies–the Inter-American Development Bank–that a new landfill site should be in operation by early next year. The site will be at Haags-Bosch on the East Bank Demerara and will accommodate solid waste from the areas between Soesdyke and Mahaica. This will result in the closure of the temporary site located in Le Repentir Cemetery, Williams said. The IDB provided the country with a US$18 million to fund the project.
Other steps to be undertaken by the council include making maximum use of the judicial processes to recover all outstanding taxes, as well as updating the Tax Register to take account of domestic properties that are used for commercial purposes, in the city.
The council will also be reviving dialogue with the central government to see how new revenue sources can be implemented. Further the council is planning to initiate discussions with unions to examine join avenues of earning revenue.
Meanwhile, the municipality has just come out of what has been a challenging financial year. Last year, the municipality had anticipated a collection of $1.95 billion from six areas but experienced a shortfall of $600 million. During last year, there were major shortfalls in the areas of solid waste (where there was a $50 million deficit from the budgeted income of $65 million) and in property taxes (where only $ 1.1 billion was collected out of the budgeted $ 1.5 billion). The city has an estimated 27,630 properties on record, excluding squatter settlements.