News | Sunday, 05 April 2009

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MEPA spends less than €1 million on car parks

Business pays €10m for car park fund – and MEPA uses it for €3.1m loan

James Debono
MEPA has spent just €941,077 since 1997 from a fund of €10.6 million intended for the development of public car parks and traffic facilities.
The fund – the commuted parking payment scheme (CPPS) – is funded directly by the fees developers and businesses pay for not providing the required parking facilities for new building projects.
But the planning authority found no problem in helping itself to the fund for an interest-free €3.1 million loan to purchase Hexagon House in Marsa from HSBC, which cost €4.3 million in total.
The loan raised questions by the Hamrun local council, which says it was denied funds to finance its own public car park. Labour MP Luciano Busuttil said MEPA refused to grant a similar loan to the Hamrun council when he was mayor of the locality.
In 2004 the council asked MEPA for a loan to finance a new car park in Hamrun, so as not to take out a loan from a commercial bank. In doing so, it asked MEPA for the cash that was paid directly to the CPPS over Hamrun developments and projects, as well as a loan, repayable in 10 years, to finance the entire expenditure.
In a letter sent by former board secretary Francis Tabone, MEPA refused the loan, telling the council that according to the “rules of scheme”, it could not lend the council money from the scheme.
The council eventually got a bank loan to finance the €1.3 million project.
MEPA has now revealed it has reversed its decision to decrease the amount of funds to the Hamrun council from the CPPS fund by €44,536.
Last week council secretary Philip Massa said that in November 2007, MEPA told the council that €150,430 had been collected in CPPS funds from Hamrun. But a year later, the council was told that only €105,894 were left in the same fund.
MEPA has now revealed that Hamrun’s CPPS balance as at 28 February 2009 has been reset to €159,383.17 after being slashed to €105,894 when the loan to buy Hexagon House was apportioned between the localities participating in the scheme. But a MEPA spokesperson told MaltaToday that “the apportionment is no longer being applied” and Hamrun will not see cuts in its CPPS fund.

No tender issued
MaltaToday can reveal that MEPA did not even issue a call for tender for a property to house the environment protection department.
A spokesperson said the authority did not need to issue a tender, citing a 2005 legal notice that states that no tendering is required for public service contracts to buy or rent, by whatever financial means, land or existing buildings.
Apart from paying €4.3 million to HSBC to buy Hexagon House, MEPA will also pay an annual ground rent of €10,505 to the government for the use of the site.

jdebono@mediatoday.com.mt

The CPPS Fund

• MEPA policy clearly states that the Commuted Parking Payment Scheme is to be used “for the construction of car parks as well as for the provision of local public transport systems and infrastructure of ancillary facilities”. Funds can be spent on public transport infrastructure such as bus lanes and priority measures, bus shelters, signage and line markings; the improvement of information to the public such as real-time information on bus stops, better route-maps or user- friendly timetables.

• The CPPS is financed directly by fees developers, businesses and shop owners pay to MEPA if they are unable to provide the required parking facilities for their projects – for example, underground garages for a block of apartments. The fee applies to all developments entailing a change of use of an existing building to a new use that carries a higher parking requirement than the old one, for example change of use from a shop to a restaurant or bar.

• The fee is also charged when a developer builds additional floors on top of an existing building as well as on all developments in Urban Conservation Areas, or areas proposed for pedestrianisation. The fee is only charged on developments taking place inside 11 major Maltese localities. Businesses in Sliema and St Julian’s alone have contributed €3.7 million to the CPPS.

• Of the €10,657,430 in fees it collected from the private sector, MEPA has so far spent: €697,253 on the park and ride in Floriana; €128,115 for the free Christmas bus service in 2007; €74,538 for a new carpark in Constitution Street, Mosta; €5,648 to fund a planning application for a car park in St Paul’s Bay; and €7,304 for a new resident car park in St Julian’s.

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