City loses $1.6m as parking firms fail to pay rental fees

City loses $1.6m as parking firms fail to pay rental fees

JAKARTA (JP): The failure of private parking management
companies to pay statutory rental fees costs the City
administration Rp 14.66 billion (US$1.6 million) a year in lost
revenue, a city councilor said yesterday.

Ali Wongso HS, head of City Council Commission D for
development, said many of the 314 companies with a license to
manage parking facilities in Jakarta did not pay their dues to BP
Parkir, the parking management agency.

He said companies were required by 1992 Gubernatorial Decree
number 1538 to pay 25 percent of their gross income in rental
fees to BP Parkir.

"Most companies pay the rental fees, but not in full," Ali
told reporters.

Ali thought that if all companies paid 25 percent as required,
the administration would receive approximately Rp 21.36 billion a
year in rental fees.

This figure, he said, was derived by multiplying the total
number of parking spaces handled by the companies by Rp 500, the
official hourly parking fee, then multiplying this number by
eight hours of daily chargeable parking time for 300 days of the
year.

No less than 71,200 parking spaces are currently handled by
314 companies, all of which are charged out at a minimum of Rp
500 per hour, he said.

The parking tariff, which applies uniformly to all companies,
is officially set by the governor at Rp 500 for the first hour
stay.

"However, some companies, including those which handle parking
at office buildings and shopping centers, have violated the
regulation by charging Rp 1,000 for a minimum stay of two hours,"
said Ali.

He added that loses incurred by the administration were also
due to its failure to control the companies, he added.

"The city does not ensure that the companies oversee parking
services correctly and it cannot prove the rental fees submitted
are incorrect," Ali said.

Ali said BP Parkir would be granted greater powers of access
to check and control parking companies once it became a city-
owned company rather than an agency. The new company will be
called PD Parkir.

The city council is working on a bylaw to change BP Parkir's
status, he said.

"The bill will allow PD Parkir to cooperate or invest in
parking management with private companies," he said.

"Parking companies will still have to share part of their
gross income with PD Parkir. The portion will be increased to 35
percent," Ali added.

Ali stressed the administration's plan to continue collecting
rental fees from private parking companies would not contradict
1997 Law No. 18 which rules that as of May 23 this year, the
sources of local taxes will be cut from 42 to nine, and levies
from 192 to 30.

"The 35 percent share we will collect from private parking
companies is not a levy but a rental fee. You see, the law does
not regulate on the collection of rental fees," he said. (cst)