Fri, 23 Feb 2001

Over 10 executives of city firm probed over land sale

JAKARTA (JP): More than 10 current and former executives of city property company PT Pembangunan Sarana Jaya have been questioned by the City Inspectorate in connection with the sale of 3.2 hectares of land at the Cibubur campsite in East Jakarta.

City administration spokesman Muhayat said on Thursday the executives questioned included the company's directors and related staff members.

The questioning began on Wednesday, he added.

The case came to the notice of the City Council and local media earlier this month, following a report that the company had sold the plot to a private company, PT Kurnia Philio Selaras, and distributed some of the money received from the sale to its employees.

Governor Sutiyoso has summoned Sarana Jaya's board of directors to clarify the matter.

The secretary of City Council Commission B for economic affairs, Dani Anwar, said a shopping center would be built on the plot, valued at an estimated Rp 27.2 billion (about US$2.86 million).

Dani alleged the sale violated the company's mandate to lease the site, and blamed the company for failing to consult with the City Council before selling the land, which is a city asset.

The plot was being leased by the National Boy Scout Movement, which used it as a parking lot.

Another councilor, Agus Darmawan of the National Mandate Party (PAN) faction, said on Thursday the company reportedly distributed about Rp 130 million of the Rp 2 billion down payment from Sarana Jaya to its 90 employees.

"The company claims to have a huge amount of debt, but it managed to distribute money to its employees. It does not make any sense. The company should improve its finances first, and also contribute more funds to the city's petty cash," Agus said.

Sarana Jaya accounted for Rp 228.42 million of the city's petty cash last year, a figure it predicts to increase to Rp 275 million this year thanks to a number of successful projects.


Sarana Jaya's top management has denied any wrongdoing. "The Cibubur site is part of our trading assets. We do not need to ask for approval from the City Council to run our business," the director of development affair at Sarana Jaya, Kemal Basha, said on Thursday.

Kemal said about Rp 1.5 billion of the downpayment on the land had been used to repay some of the Rp 34 billion in debt it has accrued since 1992, while the remaining Rp 500 million was allocated to complete the land certificates.

He said the company owns at least 70 hectares of tradable land, apart from fixed assets such as office buildings in Budi Kemuliaan and Cikini, both in Central Jakarta.

Sarana Jaya also has admitted to having sold the land to cover its debts to city-run Bank DKI, Kemal said, adding that the company would release the land once it completed the land certificates.

Kemal revealed that Sarana Jaya also was offering three other areas -- a 28-hectare plot of land in Pulo Jahe, East Jakarta, a 20-hectare plot of land in Pondok Kacang Barat, Bintaro, and 28- hectares of land in Pondok Aren, Cileduk, Tangerag, for sales this year.

He added that most of these properties, projected for housing complexes, are in the process of certification.

"The sales are part of an effort to improve the financial condition of the company," Kemal said.

According to the city's spatial plans, the 3.2 hectares of land in Cibubur is designed for a city park, with coefficient buildings limited to 20 percent with building no higher than four stories.

"The private company is planning to construct a concert hall with public facilities, including a supermarket. It is not against the regulations," Kemal said.

PT Kurnia Philio Selaras executives refused to comment on the issue. (07)