New standardised rates for building fees

New standardised rates for building fees

Wednesday, May 29, 2019

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KINGSTON, Jamaica — The Government has announced new standardised rates for building fees charged by local authorities.

Local Government and Community Development Minister Desmond McKenzie, says the new regime incorporates three rates for all categories of work undertaken, which have been approved by local building authorities.

He was speaking during his 2019/20 Sectoral Debate presentation in the House of Representatives yesterday.

The minister said the new regime comprises a standard rate of $90,000 per square metre, applicable to all construction categories, which will be reviewed every two years; a residential rate of .25 per cent of the estimated construction cost; and a commercial, institutional, industrial and resort rate of .5 per cent of the estimated construction cost.

“These residential and commercial rates are a 50 per cent reduction of the current rates in the building by-laws. We want to ensure regulatory efficiency, and ensure that the fees are manageable for homeowners and business people at every economic level, as they pursue their development objectives,” the minister said.

These revisions are consistent with the Government's decision to harmonise the development approvals process.

McKenzie advised the House that the standardised rates, which emerged from discussions between the ministry and local authorities dating back to last year, will improve the predictability of the development approvals application process, a critical International Monetary Fund (IMF) benchmark.

Additionally, he said they will streamline the local authorities' payment process of one per cent of the fees collected annually into the National Disaster Fund, as required by the Disaster Risk Management Act (Section 37b).

The minister further said that fees would also be revised to keep pace with “modern realities” and eliminate the prevailing situation where, contrary to building regulations, there are “substantial variations” in the sums charged by local authorities.

“These revised, standardised fees will give local authorities the financial muscle to increase technical staff, procure new technology and do the necessary research to ensure thorough validation of applications, and increase the numbers of approvals within 90 days,” he added.

“It is expected that by 2021, all local authorities will apply the same building fees to the same categories of building applications, islandwide,” McKenzie told the House.

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