Gov’t writes off Randyke Gardens bailout

The Cayman Islands government will not collect hundreds of thousands of dollars loaned to a local apartment complex strata in 2007 to assist with sewer repairs that were done after wastewater backed up nearly to residents’ doorsteps.

Finance Minister Marco Archer confirmed this week that the $937,000 in payments for “government guarantees” within the upcoming 2014/15 budget include “the writing off of an outstanding balance that was due to government from an apartment complex in Randyke Gardens, George Town.”

“Government provided a loan to the apartment complex, to acquire [a sewage treatment plant], as it was impressed upon government that to do otherwise would likely result in a public health issue arising at the apartment complex,” Mr. Archer said in a statement.

Government officials, including former Deputy Premier Juliana O’Connor-Connolly met with strata plan managers at the Randyke Gardens complex as early as November 2011. At the time, it was determined that the complex had not only wastewater containment problems, but planning violations and environmental health concerns.

The remainder of the payments from the $937,000 identified in the upcoming budget had to do with “planned payments” from the government’s Home Assisted Mortgage Scheme that were unrelated to the wastewater issues at Randyke Gardens.

According to records of meetings dating back to 2011, it was determined that the strata plan owed government “substantial fees,” including the repayment of a $440,000 government loan for the new wastewater treatment system that was installed in 2007. The strata plan also owed nearly $400,000 in garbage fees.

Minister Archer did not state how much of the debt owed to the Cayman Islands government by the complex had been written off in the budget year that begins on July 1.

Earlier reports in the Cayman Compass indicated that the government provided the Water Authority-Cayman some $40,000 for “emergency repairs” of the failing wastewater system at Randyke Gardens, but that the work was delayed for months because of the strata plan’s failure to pay electric bills or to sign a maintenance contract with a service provider.

Meanwhile, roughly 15,000 gallons of untreated sewage was being pumped into the ground at the complex each day, minutes of Water Authority-Cayman board minutes noted.

The authority noted that the strata had become compliant with health and safety conditions in February 2012 and that the wastewater system installed there should have been operational by April 2012.

The sewage discharge at the Randyke Gardens site was first reported in January 2011.

According to minutes from the authority meetings, the strata repeatedly missed deadlines set in order to qualify for government assistance. In October 2011, the board learned the strata had not been paying its bills from the Caribbean Utilities Company for the four electric meters connected to the complex’s eight wastewater systems. The east George Town development comprises 10 buildings with 80 units, plus additional unapproved structures.

According to the minutes of the board’s Oct. 19, 2011, meeting, the authority was concerned that if the strata did not pay for the electricity to run the wastewater systems, they would fail quickly after government-funded repairs. If that happened, the authority would ask for the matter to be prosecuted for violation of the Water Authority Law or for government to consider condemning the development “as it is unsuitable for human habitation.”

According to the Water Authority Law, the violation of discharging raw sewage onto the ground carries a penalty of a fine of $6,000 and one year’s imprisonment.

The board set a deadline of 10 working days for compliance before the authority would recommend that the government withdraw its offer to assist.

However, “The Ministry [of District Administration, Works, Lands and Agriculture] subsequently asked the authority to hold off on this notice as other options were being explored to assist Randyke Gardens,” according to the minutes of the board’s next meeting Nov. 16, 2011.

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3 COMMENTS

  1. So, as a property manager, it is now my professional duty to advise all the stratas that I manage which are struggling to pay their garbage and waste disposal fees, due to strata fee arrears by owners etc…not to worry making any payments as the Government will bail them out in the end and wipe out any accrued debt? Let the good times roll!

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  2. Why has the government made the decision to write off this debt? If the apartment complex in question still exists then the government should be collecting the money that is owed.

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