Citing a “threat to public safety” in light of the planned increase in tolls, the government yesterday assumed temporary control over the operation of the Berbice River Bridge and promised to retain the present toll structure as its seek to find an amicable resolution to its ongoing dispute with the concessionaire, the Berbice Bridge Company Inc. (BBCI).
The announcement by the government will likely raise concerns in the investment community as it amounts to the compulsory acquisition of private property, a practice deeply frowned upon. Compulsory acquisition had gained infamy during the years of PNC government and under the leadership of the late President Forbes Burnham.
Through a statement issued by the Ministry of Public Infrastructure yesterday, the government announced that Public Infrastructure Minister David Patterson had issued an order declaring that the functions of the BBCI “to maintain and operate the bridge shall be exercised by the Government of Guyana as of November 5th 2018 until the date the Minister specifies by notice on the cessation of the threat to public safety.”
The statement said Patterson’s decision was in accordance with powers conferred upon him by sections 4 (1) and (11) of the Berbice River Bridge Act.
It also stated that there will be no change to the staff, contractors and suppliers as they transition into the temporary arrangement and there will be no change to the present toll structure. All exemptions presently in place will also remain in effect, it added.
The move by the government comes after the bridge company announced that there would be a huge increase in all tolls from November 12th.
The announcement had been met with opposition by Patterson, who had stated that the government would in no way allow “unconscionable increases” and would be seeking legal advice from the Attorney General’s chambers.
The statement issued yesterday echoed Patterson’s earlier sentiments, saying that it has been publicly stated by the Ministry and the Government of Guyana that they cannot support the unreasonable demand for an increase in toll on the public “which is based on a flawed formula and computation. We have stated that these increases by BBCI are unwarranted and will become burdensome to the people of Berbice and the public, at-large.”
“On the basis of correspondence between both sides as recently as over the past few days, we do not envision a swift resolution to this crisis…. We will do everything in our powers to alleviate disruption to the public and ensure that the assumption of these functions is as smooth as possible,” the statement added.
It went on to state that too many citizens depend on the continuous operations and the use of the bridge, and as a result, “we should not allow anyone to unreasonably and capriciously endanger their livelihood and public order in one of our vital regions.”
“And finally, we will be continuing our dialogue with BBCI in expectation of an amicable resolution to the dispute,” the statement added.
In announcing the planned increases, Chair-man of the Board of Directors of BBCI Dr Surendra Persaud said the decision was based on legal advice that the company had received, while also noting that no prior adjustments were ever made and no surpluses have been earned, resulting in the required hikes in the tolls being compounded.
Efforts to contact the company yesterday for a response to the announcement were unsuccessful.
Stabroek News was told multiple times that the personnel authorised to
comment were not available despite several calls throughout the day.
However, company spokesperson Kit Nascimento related that all he was at liberty to say at the moment was that BCCI was consulting its lawyers.
In an invited comment, Private Sector Commission head Desmond Sears said it was unfortunate that the company and government were not able to arrive at an amicable solution and he hopes that the current rift between the two would not affect the public-private partnership model in the future.
“We met the bridge company, who is one of our members, and we also sought to have the Minister of Finance [Winston Jordan] and Minister Patterson engage in a discussion to find a solution but the Minister of Finance did indicate to us that the matter was at the office at the Attorney General and it was too premature to meet,” Sears said, while stating that the Commission will not intervene at this time.
“It is a contract dispute and as such, the parties should be given the space to take actions as they seem fit. We will regroup sometime this week and have another discussion with the executives of the council,” he added.
The announcement by the Ministry comes days after the BBCI proposed a 19-year extension of the contract as an alternative to raising the tolls.
The BBCI Finance Controller Stephen Rambajan, in a letter to Patterson that was released to the media, said the Board of Directors of the company was seeking an immediate meeting to discuss the proposed extension of the concession period to 40 years, that is, with an additional 19 years, as a means of avoiding the need for implementation of the toll increases announced by the company last month.
The BBCI also proposed that when the agreement is reached, a “joint statement announcing that the Government of Guyana (as the Grantor) and BBCI (as the Concessionaire) have come to agreement on a solution to toll adjustments for the Berbice River Bridge going forward which will be announced shortly and that the company will not proceed with the toll adjustments which were announced on October 1th 2018.”
However, Patterson’s ministry in its statement said it was currently seeking legal advice on the matter and it could also not commit to a meeting date, until the letter was discussed with the APNU+AFC Cabinet, scheduled for tomorrow.
“The Ministry wishes to publicly state that while it supports and welcomes the BBCI’s request for transparent discussions, the Ministry is also currently engaged in obtaining legal advice on the matter and the Government of Guyana will be reviewing all available options under the confines of the law, as well as possible actions proposed by BBCI prior to any meeting with the BBCI.
“Notwithstanding the above, BBCI’s revised proposal will be shared at the next cabinet meeting slated for next Wednesday, after which a meeting will be scheduled with BBCI to communicate cabinet’s decision, and hopefully move this process forward. The Ministry wishes to note that this response to BBCI is by no means a refusal to meet; rather, it serves to ensure that the Government of Guyana continues to stand ready to advance the best possible option to all Guyanese in continuing dialogue,” it added.
This statement by Patterson’s ministry conveyed no hint that the bridge would be taken over before tomorrow’s Cabinet meeting and the move would therefore be seen as a breach of good faith.
The company, in a letter published in the November 2nd edition of this newspaper, had said that government had refused to meet with it to discuss bridge tolls, despite three requests.
“The BBCI is bound by its Concession Agreement under the Berbice River Bridge Act in implementing the tolls charged at the Bridge. The Company has no alternative but to honour the Toll Adjustment Formula prescribed in the Agreement. The Company has no discretion in calculating the amount of the toll. The Company is bound by the Toll Adjustment Policy dictating the Formula. Since 2015, respective governments (previous and present) have violated their contractual obligations to implement an annual toll adjustment which would have resulted in small incremental adjustments instead of the current burdensome level… The current level of toll adjustment is entirely the fault of the government, not the Company,” the letter stated.
“Prior to and since taking office, this government has refused to meet with the BBCI in spite of three requests to do so. The power and the privilege to review or amend the Concession Agreement rest entirely with the government,” it added.
Patterson’s ministry replied to the letter through an advertisement which was also carried as a letter in this newspaper, stating that the BBCI’s statements were riddled with inaccuracies.
Patterson’s ministry said that the government has never refused to meet with BBCI and there were records to that effect and BBCI’s acceptance of government taking over the maintenance of the 39 pontoons of the bridge was reflective of this.
“It is inaccurate that the Government has refused to meet with the BBCI. In fact, the Ministry met with the BBCI on Thursday, October 11, 2018, prior to the announcement of the proposed toll increases. At this meeting it was mutually agreed by the parties that the Ministry communicated its offer to assume full responsibility for the maintenance and rehabilitation of thirty-nine pontoons- an obligation under the Concession Agreement that the BBCI failed to execute during the years of operation. By correspondence dated October 16 and 17, 2018 to the Berbice Bridge Company Inc., the Ministry of Public Infrastructure had firmly reiterated its commitment to assume full responsibility for the maintenance and rehabilitation of the 39 pontoons. The Berbice Bridge Company Inc. has since acknowledged and accepted this proposal and the Ministry is working towards commencement of maintenance in 2019,” it added.
While admitting that Patterson is correct about the BBCI’s acceptance of government’s maintenance of the pontoons, Nascimento was adamant that the minister refused to discuss the tolls.
“He refused to discuss the toll adjustment. He has misrepresented the case. All he was prepared for was to talk about the maintenance of the bridge. He is correct—he offered to take over the maintenance and the company has written accepting that offer. But there was absolutely no discussion on the toll because he refused to entertain it,” Nascimento said.