Cost of retrofitting leased Mandeville property 'close to' $1 billion, says TAJ

Tax Administration Jamaica (TAJ) says it will cost taxpayers "close to" $1 billion to retrofit a leased property in Mandeville, Manchester, to provide services to the public.

Head of the agency, Ainsley Powell, made the disclosure Tuesday morning during an appearance before the Public Accounts Committee (PAC) of Parliament. 

The TAJ is yet to occupy the building more than three years after it inked a lease agreement in September 2020 with the property owner.

It is expected to be opened in September 2025. 

The PAC was examining a report by the Auditor General's Department on the TAJ's lease arrangements. It was tabled in the Parliament in March.

The report highlighted that TAJ spent $357 million up to August last year to lease the Mandeville property. The figure has climbed to $451 million, Powell said. 

The TAJ has said its occupation of the properties has been impacted by procurement issues.

TAJ blames long procurement process for failure to occupy leased properties

The total costs of lease payments so far and the anticipated retrofitting costs now total approximately $1.5 billion for the 42,300-square-foot location in Greenvale, Mandeville. 

TAJ has not disclosed the property owner. 

PAC Chairman Julian Robinson questioned whether other options were explored given the costs. 

Powell said the agency considered other options but they turned out to be more costly and inconvenient. 

"When we started out we had actually pursued the acquisition of property which we were not able to find suitable property within the confines of Mandeville," he said, noting that parking and reducing transportation costs for some taxpayers played a role in the decision. 

Another property leased by TAJ in Annotto Bay, St Mary, which it is yet to be occupied, now costs taxpayers $23 million.

Up to August, last year, TAJ spent $15 million on the unoccupied building in Annotto Bay. That agreement was signed with Noraldu Limited, a company owned by Jamaica Labour Party MP, Dr Norman Dunn, in December 2021. 

Powell told members of the PAC that it will cost the agency $30 million to retrofit the Annotto Bay building. It is scheduled to be opened to the public by September this year.

The Auditor General's Department said there was no evidence that Dunn interfered in the process.

Parliament also gave Noraldu an ethics exemption to enter into contracts with the government in December 2020. 

- Edmond Campbell

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