Trinidad & Tobago Govt to challenge, terminate, re-negotiate property leases under previous administration
Wednesday, November 08 2017 @ 04:55 PM AST
Contributed by: DeoBhagan
Land use in Chaguaramas is governed by the Town and Country Planning (Chaguaramas) Development Order, which requires a Development Plan to be prepared and approved by Parliament; the last Development Plan was the 1974 Development Plan; development on the peninsula and leases granted ought to be in alignment with the permitted land use in accordance with such a Plan; in 2015, the CDA Board commissioned a Master Plan for the Chaguaramas Peninsular, however, that Plan was never approved by Parliament. As a consequence, the Development Plan of 1974 is the only development plan for the North –West peninsula in accordance with Section 16 of the Chaguaramas Development Authority.
To address this situation, the CDA sought External Counsel (M.G. Daly) who advised that “In exercising its principal functions in accordance with section 14 of the CDA Act, the CDA is bound to act in accordance with the 1974 Development Plan.” He also advised that “It is not open to the Minister of Planning and Sustainable Development to direct the CDA to act outside of the 1974 Development Plan.” Counsel has also advised that “To the extent that the CDA has purported to grant leases, the permitted uses of which are not consistent with the 1974 Development Plan, those leases are plainly illegal and unenforceable.
Additionally, further investigation revealed that there were a number of leases that were granted by the CDA between the period 2010 to 2015 that were not in the best interest of the CDA or the public’s interest. The Board of the CDA, after having reviewed a number of matters including leases granted/terminated during the period 2010 to 2015 by the CDA, decided to retain the services of Ernst & Young Services Limited (EYSL) to review the following areas, inter alia:
“selected leases entered into/terminated during the period 2010 to 2015,
tendering processes and awards of key contracts/projects during the period 2012 to 2015”
EYSL, working with other independent experts, identified, inter alia, a number of leases which were deemed to be unfavourable to the CDA and not in the public’s interest.
Two (2) of the leases which were found to be unfavourable to the CDA and not in the public’s interest were:
a lease dated May 22, 2015 between a company called Chaguaramas Parking Limited (CPL) and the CDA; the major terms of that lease were that the CDA would lease 1.62 hectares of land to CPL for 30 years at a lease rental rate of $1.00 annually and CPL would construct a 1,000 car park facility and, subsequently, lease the car park back to the CDA at a monthly rate of $898,000.00;
a lease dated April 25, 2014 between a company called Fouraime Enterprises Limited (Fouraime) and the CDA which was a 30 year lease, the initial rent for the first eighteen (18) months was $3,400.00 per month and after the eighteen (18) month initial period, an annual rental of $5,000,000.00; two (2) other agreements were executed by Fouraime and CDA on September 4, 2015 for Fouraime to surrender five (5) acres of its leased land back to the CDA and for the CDA to provide temporary car park facilities and to pay Fouraime the sum of $600,000.00;
the land area that was leased to Fouraime by the CDA included all of the waterfront from the area known as Pier 1 all the way along the shoreline to the area commonly referred to as “the Hangar”; Fouraime’s plans entailed some access to the waterfront by the public, but importantly, the loss of that waterfront and shoreline to the members of the public could not be in the public’s best interest;
furthermore, on an analysis of the terms of the Fouraime lease, it was found, inter alia, that:
there was significant non-compliance with CDA’s stated leasing policy
the annual rent of $5,000,000.00 which was agreed to after the initial eighteen (18) month period of a peppercorn rate of rent, was between $1,145,000.00 to $5,075,000.00 lower than two (2) independent valuations obtained
there was insufficient public parking for the public who may wish to access the beach and seashore along the said shoreline
there was insufficient public access to the beach and shoreline for the public
necessary planning permission was lacking
the public, via the State, would have no access to any deep-water facility with the loss of the shoreline along the area known as Pier II;
The Government has been in negotiations with Fouraime and one of the victories is that CPL has agreed to surrender its lease without any cost to CDA provided that the CDA provide 1,000 car park spots for Fouraime’s customers on or before March 31, 2018;
After negotiations Fouraime has agreed, inter alia, to the following:
the widening of the beach along the shoreline, where possible
the provision of direct access to the beach from the Western Main Road along the western end of the project
the expansion of public parking on the western end of the project for public beach parking
Fouraime would return a specified and agreed area of Pier II to the CDA
The Joe Pires Lease Issue Caribbean Chemicals and Agencies Limited
By Cabinet Minute No. 2220 of August 30, 2007 Cabinet agreed inter alia to the establishment and operation of a 200 acre farm in Tucker Valley, Chaguaramas and to the establishment of a State-owned Company to manage the enterprise and that pending the incorporation of the State owned Company the Authority be appointed the executing agency for the project.
By Cabinet Minute No. 1731 of December 16, 2010 Cabinet agreed that the responsibility as executing agency for the 200 acre Commercial/Demonstration Farm located at Tucker Valley, Chaguaramas be reassigned from the Authority to the Ministry of Food Production, Land and Marine Affairs.
By Cabinet Minute No. 3289 of December 8th 2011 Cabinet agreed inter alia that the Authority grant a lease of approximately 100 acres of land of the Tucker Valley Farm at Chaguaramas to the Ministry of Food Production, Land and Marine Affairs and the re-allocation of that land for private investment for the operation and management of a commercial large farm enterprise. The Ministry of Food Production, Land and Marine Affairs selected Caribbean Chemicals and Agencies Limited as the tenant for the second 100 acres. By Deed of Lease dated 13th March 2014 Chaguaramas Farms Ltd (Caribbean Chemicals and Agencies Limited) was granted a lease by the Authority of 40.5260 hectares of land situate at Tucker Valley, Chaguaramas for a term of thirty (30) years at a rent of $180,000.00 annually payable by equal monthly instalments of $15,000.00.
The Guave Road Farmers and Haig Community United
Note also that the issue concerning the Guave Road Farmers and Haig Community group’s right to possession of two (2) parcels of land in the Guave Road area for the planting of crops has been resolved.
Discussions have taken place with the tenant, Chaguaramas Farms Ltd (Caribbean Chemicals and Agencies Limited), as it relates to the surrendering of part of the lands leased that are not being utilized by the company. The following variations, inter alia, to the existing lease with the tenant were proposed and accepted:
1. Surrendering of approximately 46.4 Acres (18.8 hectares) of lands
2. Reduction of the rent from $15,000.00 to $9,000.00 (VAT Exclusive).
Finally, I would like the public to know that the Minister in the Ministry of the Attorney General and Legal Affairs and Minister in the Office of the Prime Minister will continue to provide direct oversight of the CDA’s management of the legal matters to ensure that various leases entered into by the CDA which are not in the public’s interest are challenged, terminated and/or re-negotiated.
(L-R) Chaguaramas Development Authority acting General Manager, Deowattee Dilraj Batoosingh, Planning Minister Camille Robinson-Regis