The Telegraph
Monday , August 1 , 2011
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Calcutta, July 31: The Centre has stopped giving the Calcutta Municipal Corporation (CMC) funds under the Jawaharlal Nehru National Urban Renewal Mission because of its refusal to levy water tax and inability to bring almost half the houses in the city under the property tax net.

Delhi has not issued a formal refusal but senior CMC officials said that every time they went to the capital and pleaded for the funds they were told to do more to generate revenue.

The consequent funds crunch has forced the Trinamul-run civic body to slam the brakes on four ongoing projects two to cleanse the clogged brick sewers that cause waterlogging across Calcutta, one to construct a waterworks that would bring filtered surface water to the eastern fringes where people now drink arsenic, and one to beautify Dalhousie.

Grants worth at least Rs 54 crore have been withheld for the projects that were initiated during the term of the previous Left-run civic board. The Centre’s refusal has meant that the state has not been able to release its matching share of the grants, taking the shortfall up to Rs 108 crore.

The CMC had spent the money from its own coffers expecting reimbursement from the central and state governments. Now that the money hasn’t arrived, it has been forced to almost stop further work on the projects.

The Centre has not released any money on the four JNNURM projects since December 2010. However, it is only over the past three months, when the CMC started pressing for the money, that Delhi made it known why the grants were being withheld.

Sources said municipal commissioner Arnab Roy and joint municipal commissioner Sahidul Islam had made several trips to the capital in the past few months. “Each time, they were told to levy the water tax, bring more house owners under property tax and collect at least 90 per cent of the property tax dues every year. These were conditions set by the Centre when it approved these projects under the JNNURM,” a CMC official said.

The CMC had then signed a covenant agreeing to abide by the conditions and the then Left government was a party to it.

The Centre had to impose such conditions because they form part of its agreement with international agencies that fund the mission. For every Rs 100 of the project cost under the JNNURM, the CMC shells out Rs 30 and the remaining Rs 70 is equally shared by the central and the state governments.

The Trinamul Congress’s Saugata Roy is the junior minister in the Union urban development department, which provides funds under the JNNURM. His boss, the Congress’s Kamal Nath, has so far not exempted Calcutta from the conditions.

All the other metros and Bangalore, Ahmedabad, Chandigarh and Patna have introduced the tax on water consumed but Mamata Banerjee has refused to do so.

Before the watershed Assembly elections, Mamata had made water tax her poll plank, promising not to burden house owners if Trinamul came to power. On May 23, days after the new regime was sworn in, the state government asked the 127 municipalities outside Calcutta, which had imposed the levy during the Left regime, not to collect water tax.

The CMC can earn at least Rs 30 crore a year by asking domestic users to pay as low as Rs 150 a month.

Mayor Sovan Chatterjee told The Telegraph: “I have met chief minister Mamata Banerjee and apprised her of the situation. We hope the financial inconvenience will be eased gradually.”

During Trinamul’s earlier stint at the CMC in 2002, the civic board had imposed a water tax and brought in its net all house owners who pay a property tax of over Rs 250. A monthly water charge of Rs 150 was levied on house owners paying a quarterly tax of Rs 250 to Rs 449. A levy of Rs 250 a month was imposed on those who paid more than Rs 450 as property tax every quarter. The Trinamul-run CMC had collected the water tax until 2004 when Mamata forced then mayor and current minister Subrata Mukherjee to withdraw it.

Mayor Chatterjee, who was mayor-in-council member in charge of water supply when it was decided to levy the tax, said last week: “Now our stand is very clear. Our chief minister is opposed to the water tax.”

According to the civic assessment department, around 40 per cent of the houses in the city do not even feature in the property tax records. The CMC loses around Rs 300 crore a year because of this. While approaching the Centre for funds under the JNNURM, the CMC had promised to bring 90 per cent of the houses under property tax.

A plan is afoot to forego the JNNURM grants and make up the shortfall through assistance from the state government and bank loans. CMC sources said municipal commissioner Arnab Roy had started negotiations with banks for loans. As part of this plan, the mayor is seeking a state government assistance of over Rs 800 crore.

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