Situation does not warrant our involvement – Harmon

City Hall’s financial woes

… “we cannot afford $60M extra per month” – Mayor

Minister of State Joseph Harmon said while the Government is concerned about the current financial situation at City Hall, it does not warrant their involvement at this point in time. Garbage contractors Cevons Waste Management and Puran Brothers Disposal pulled their services for the second time in less than a month after being owed over $300 million.

At his post-Cabinet press briefing on Friday, Harmon said the issue is a pressing one since the Government would not like to see garbage piling up in the city. He however noted that the Communities Ministry and the Mayor and City Council have the resources and capacity to address the situation.
“It is something that is of concern to us…. the question of payment with these waste management companies always seem to be an issue with the City Council and has been going and coming,” he said.
“Eventually they arrive at a solution that is mutually beneficial and they resume so I am saying while we are concerned, it is not a situation that would require us getting into the situation right now. I think we are still benefiting from services and removal of waste from the city and I would prefer the Ministry of Communities and the City Council be given an opportunity to resolve that and the question here is payment for past services and I think there is always a mechanism in negotiating those payment arrangements,” Harmon added.
Puran Brothers Disposal Inc and Cevons Waste Management decided to withdraw their services to City Hall, as the lack of payment to the companies continued despite promises to be paid.
According to the companies in a joint statement on Saturday, the issue of non-payment for services rendered has been a long-standing one. The companies revealed that City Hall’s debt dates as far back as 2015 and promises proffered by the Council have not been honoured.
The straw that broke the camel’s back, however, dates from July 12, 2017 when the companies resumed work after a four-day suspension of services over the same issue.
They stated that their return is conditional based on a meeting that would have been held to discuss payments. However, despite assurances from the Communities Minister, the companies said there has been no such meeting nor has the municipal authorities “shown (any) inclination to meet with us.”
In a telephone interview with Guyana Times, Mayor Patricia Chase Green said City Hall cannot afford to clear its debt at this time since they have other financial obligations to honour. She explains that they met with both companies on Friday last and told them of the financial complications.
“They are saying that we need to pay them that money in six months. It will be very difficult for us to find $60 million extra to pay on that $300 million, plus pay or salary bill plus pay our current indebted debt to them which is like $43 million plus pay other contractors who are doing other works in the city, plus maintaining whatever it is in the city of Georgetown,” she said.
“We said to them ‘look it will be very difficult to do that in six months, could we not negotiate and move forward’. They both said at that meeting that they are not willing to go forward with that, they want their money and so they are withdrawing their services and they were not willing to continue with any other discussion,” Chase Green added.
She said the companies are demanding they be paid before the resumption of their services.
Sometime in December 2016, the Mayor and City Council (M&CC) appealed to the Government for a $600 million bailout and they did not accept the appeal. Out of that $600 million, $300 million was for the contractors.
“There is an emergency crew that was set up on Friday; there are going to be systems that would be out in place and I would appeal to citizens to don’t dump garbage along the streets,” she said.
For quite some time, the M&CC has been accused of being cash strapped, and on multiple occasions, work around the city has had to be halted since the municipality was unable to pay workers.
Earlier this year, it was reported that the Council and its partners (the contractors) reached an agreement, which in substance said that the City Treasurer would focus on payment of the current accounts while working to find an arrangement to settle the outstanding debts for 2016 while avoiding service disruption.
The Council has said that it would be putting alternative measures in place for garbage collection, and urged residents to ensure they properly dispose of their waste and await the arrival of the garbage collectors. They also say that the Treasurer’s Department would be intensifying its revenue collection drive to recover money owed to the city.
At a meeting with stakeholders in April 2017, the Mayor had informed that the Council is cash strapped and requested businesses pay more for commercial waste disposal. Mayor Chase Green had told business folks that City Hall cannot afford to keep up with the weekly amount of $1.8 million to clear commercial waste.
Though there have been talks of the implementation of a new fee for commercial waste, City Hall officials have remained mum on just how much they are proposing to charge. Notwithstanding, the Mayor threatened that should businesses refuse to pay the new fee, City Hall will have to resort to using the law to discipline them.
Town Clerk Royston King noted that even if citizens pay all of their outstanding taxes, the Council would still fall short of enough money to cover everything it has to do. King said the implementation of a new fee is in order because the service of waste disposal is a very expensive one that the Council cannot afford at the moment.