Tuesday, August 10, 2010

BBMP leases out prime property for Rs 24 a yr

BBMP leases out prime property for Rs 24 a yr
Strapped for money to carry out development projects, the civic agency is losing crores from 373 properties in the city leased out to individuals, organisations and parties
Suchith.Kidiyoor @timesgroup.com

Cash-starved BBMP has leased out properties worth crores for a paltry Rs 57 lakh per annum, according to an internal audit done in the run-up to its annual budget.
Bruhat Bengaluru Mahanagara Palike (BBMP), which is struggling to mobilise finances to execute development projects in the city, has realised that it is losing crores of rupees from the 373 properties worth Rs 1,364 crore that it has leased out in the city’s core area to private individuals, organisations and even political parties.
Some of the properties earn rentals as low as Rs 24 and Rs 36 per annum when the actual market rate would run into crores.
The lease rates for a majority of these properties have been fixed more than a decade ago. If it is revised according to present rates, BBMP can easily earn around Rs 100 crore as rentals alone. That way, the tax burden on people can be reduced and more development projects taken up, a senior BBMP official told Bangalore Mirror.
There’s more. The lease period of 181 tenants has expired but they continue to stay put. In fact, a few senior corporators including JD(S) leader Padmanabha Reddy raised the issue in the past and have demanded that BBMP crack down on the squatters.
It is against this background that the BBMP has decided to streamline the maintenance of its properties.
Mayor S K Nataraj said: “A committee has been formed to inspect the properties leased out and submit a report. In the case of the 181 properties for which the lease period has expired, the committee will examine how to generate revenue from these sources. If we cannot recover the land, we plan to sell it to the lessee based on the current market value.”
The Mayor’s move to sell the land is like opening up Pandora’s Box as it would enable land developers and politicians to make a backdoor entry and take over BBMP properties in prime localities. This has not enthused everyone in the BBMP, sources said.
A high ranking official said, “The BBMP has every right to take possession of its properties. Out of the 181 properties, 84 were leased out to educational institutions, hospitals, private institutions, societies and others. Eighty-three were leased out to individuals and the remaining 14 to state and central government establishments. We have found that many lessees were not using the properties for the right purpose and have violated the agreement. In those cases, BBMP plans to seize the properties.”
A BBMP official said, “We have identified several properties which lessees have rented out for commercial purposes. There are hospitals on such lands making crores instead of doing charity work. Spread over acres, these hospitals pay only Rs 250 per month as lease amount and make money by opening nursing schools, renting out space to hotels, shops and other establishments. However, there are many institutions like schools for the physically challenged, research institutes schools which are doing good work.”
The BBMP has already served notices to 72 lessees as an initiative to get back its lands. The official said, “As per the Karnataka Municipal Act, the lessees have to return the land along with the buildings they may have constructed.”
The BBMP has also received 93 applications from lessees to renew their leases but it is up to the state government to decide.
There are 14 renewal cases pending before the cabinet. Recently, the Gymkhana Club renewed its lease for four acres after the cabinet’s consent.


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