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KSAMC to start discussions with JPS about encroachment fees

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KSAMC to start discussions with JPS about encroachment fees

BY CLAUDIENNE EDWARDS
Observer writer

Monday, February 04, 2019

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THE Finance Committee of the Kingston and St Andrew Municipal Corporation (KSAMC) has given CEO Robert Hill the green light to start preliminary discussions with the Jamaica Public Service Company (JPSCo) about encroachment fees the council proposes to charge the utility company.

On a suggestion from People’s National Party (PNP) councillor Dennis Gordon (Maxfield Division), the committee agreed last Thursday that the CEO should engage the JPS in preliminary talks on the cess.

At a September 2018 meeting of the committee, on learning that research showed that the municipalities could earn US $17 million in encroachment fees from the JPS over a six-month period, it was suggested that the municipalities charge the JPS encroachment fees of four per cent of its net income.

However, at the recent meeting, Vernon McLeod, chairman of the committee, noted that they would have to move cautiously as the cess on the JPS could impact electricity rates generally.

The CEO recommended that a bipartisan select committee look at the matter and arrive at a decision.

The meeting agreed that at a later date Mayor Delroy Williams, the Ministry of Local Government, and the Ministry of Finance would be invited to join the discussion.

In the meantime, Ketha Silvera, the legal officer at the KSAMC, has outlined some of the possible challenges to easements the municipality could face in trying to implement the cess.

In an opinion to the Finance Committee entitled “Proposal for implementation of charges to the JPS for the use of land owned by the KSAMC”, Silvera said that easement, a legal term that gives one person the right over another person’s land, also requires that certain basic requirements be met.

“What the JPS now enjoys is akin to an easement and while it is not explicitly stated, it is believed that an easement by prescription was created over time to facilitate the transmission/distribution of electricity islandwide. This satisfies some of the requirements of an easement as presently the JPS benefits from long continuous and apparent use of lands belonging to the KSAMC. Without the necessary legislation, the KSAMC might find it difficult to implement these charges.”

The April 2018 meeting of the Finance Committee argued that a cess on the utility company was one of the ways that could be used to increase the council’s own source revenue.

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