City setting up new committee to renegotiate parking contract

-to include members from public

The Georgetown Mayor and City Council will over the next two weeks develop the Terms of Reference (ToR) for its newest Metered Parking Rene-gotiation Committee.

At yesterday’s statutory council meeting, it was decided that the nine-member committee will comprise seven councillors and two members of the public who will have voting rights. Town Clerk Royston King and City Treasurer Ron McCalman will also sit on the committee but only in an advisory capacity.

What exactly the committee will do is to be decided at the next statutory meeting, scheduled for September 25, at which the ToR will be presented. Once the ToR have been approved, the seven councillors will be selected and two members of the public will thereafter be nominated by any member of the 30-member council.

Another meeting will then be called so that the council can vote on the nominees.

While 16 of the 19 councillors present cast their vote in support of this proposition, three APNU+AFC councillors, Deputy Mayor Lionel Jaikarran, Gregory Fraser and Andrea Marks, abstained from voting.

This will be the second committee the council has set up to renegotiate its controversial contract with Smart City Solutions (SCS). The first, led by Team Legacy Councillor Malcolm Ferreira, was put together after the metered parking project was suspended by central government in March.

That committee was mandated to review the contract, consult with all stakeholders and recommend possible solutions to any impasse that may arise from the implementation of the metered parking project.

The team was specifically tasked with addressing five areas of concern identified by Central Government. These included the unequal terms of the contract, which disproportionately favours the concessionaire; the fees, which are too burdensome; the too high penalties for non-compliance; and the inclusion of gazetted public roads and certain areas around schools and hospitals.

After three months of stakeholder engagements, the committee submitted its report to Mayor Patricia Chase-Green and Town Clerk King on August 2.

In that report, it noted that though SCS was asked to provide proof of its stated millions in investments, it refused to do so. The company also refused to share with the committee its feasibility study and business proposal unless its members agreed to sign a confidentiality agreement.

However, the report says “given the public nature of the parking meter fiasco the committee found it necessary to reject the idea of signing a non-disclosure agreement or to be bound by secrecy.”

Additionally, during its three months of investigations, the committee noted that concessionaire SCS had vastly inflated estimates of its capital investment.

And while SCS refused to provide documentation, the report says consultations with an independent accountant raised red flags about the veracity of several of SCS’ claims. It notes that the accountant found that there is a more than 25% variance in SCS’s estimation of its original operations total and the accountant’s total. The variance is in excess of $600 million.

The report says the committee’s accountant, Lancelot Atherly, found that the total was adjusted for apparent excessive estimates. He further explained that 25% is a conservative estimate and that the actual variance could be as much as 50% since quite a lot is overstated and some aspects seem vastly overstated, bloated and inflated.

The accountant also found that the Government of Guyana stands to collect more revenue than the city of Georgetown by way of Corporation Tax and Value-Added Tax but SCS gets the most overall.

Given the importance of ascertaining the true initial capital expenditure, Atherly advised the committee that it was prudent that all verifying documents be presented to the committee. The committee said this recommendation was also made by Minister of Legal Affairs Basil Williams and Finance Secretary Hector Butts, who agreed that SCS should willingly release such documents as requested, as is the norm for due diligence. The documents, however, were never presented to the committee and so no further discussions took place.

Despite the committee’s findings, a majority of councillors (13 out of 25) present at an extraordinary meeting last Thursday voted to continue the metered parking system with SCS, pending a renegotiation of the controversial contract with the company.

This was among the options presented to the council by the renegotiation committee led by Ferreira.

As a result of Thursday’s vote, the council will have to seek a further extension on the Cabinet-ordered suspension of the project.  It is unclear whether SCS would be amenable to a renegotiation of the contract. It has maintained its silence for months now.

In renegotiating the contract, the new committee will have to address and resolve all of the points/findings listed in the report of the last renegotiation committee.

This option came with seven caveats, including hosting public meetings to apprise all stakeholders of the findings of the committee and to articulate and further discuss the areas that should be included in the new contract; being provided with any and all documents by SCS Inc within reasonable time when requested, including those of a financial nature; as well as being provided with relevant documents such as a feasibility study, business plan and environmental impact assessment. The committee also called for due diligence to be observed as it related to any new agreement or amendment to any existing agreement and the completion of an independent “Project Analysis” to offer proper guidance.

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