Tax income from areas near Senayan very low
Bambang Nurbianto, The Jakarta Post, Jakarta
Although land in the area close to the Senayan sports complex in Central Jakarta is assessed by the tax office as being worth up to Rp 10 million per square meter, the sports complex management can earn only Rp 15 billion to Rp 16 billion in royalties from the private sector parties that occupy 66.74 hectares (ha) of the land.
This means that the royalties on one ha, or 1,000 square meters, of land in the strategic area, which is under the control of the Bung Karno Sports Complex Management Board, is only about Rp 239 million per year.
The 66.74 ha forms part of the 279.1 ha of land which were originally allocated for sports and related facilities as well as open areas needed as green "lungs" for the city.
But the sport facilities now occupy only 146.57 ha of land, which was cleared prior to the fourth Asian Games in 1962, while the rest has been used by the private sector and government offices.
Urban observers and environmental activists have expressed concern over the continuing encroachment onto open land at the sports complex by private companies as it has reduced the green areas of the city.
Executive chairman of the Bung Karno Sports Complex Management Board Yasidi Hambali said that cooperation between his office and a number of private companies was based mainly on build-operate- transfer (BOT) agreements that last 30 years to 40 years. Some other parties occupied the land after they obtained land use permits (HGB) from the National Land Agency.
Asked about the small amount in annual earnings from the private sector, Yasidi argued that the monetary value of the royalties is not the only benefit that accrues to the management board.
He said that apart from paying annual royalties of US$400,000, PT Kajima Overseas Asia, which built Plaza Senayan on a 19.85- hectare site, also built Hotel Atlet Century Park for the Bung Karno Sports Complex Management Board as compensation.
The hotel is included in the list of sports facilities, even though most of the guests are not normally athletes.
"The most important thing is that the buildings on the land, which are now being managed by the private sector, will be handed over to the managing board when the BOT agreements expire," Yasidi told The Jakarta Post on Wednesday.
The decision to develop the area, which used to be called Senayan sports complex, was made in 1958 after the Asian Games committee appointed Indonesia to host the games.
Based on Presidential Decree No. 79/1962 on the Establishment of Senayan Sports Complex foundation, the land could be used for sports and sport-related purposes, such as recreation, parks, health centers, and a television station.
Occupation of the land by the private sector officially began when former president Soeharto issued decree No. 4 in 1984, allowing the management board of the sports complex to work in cooperation with the private sector to use the land.
But even before the decree's issuance, there were violations against the land use plan when several private sector parties constructed buildings in the area after securing land use permits. Those buildings include Hilton Hotel and Ratu Plaza on Jl. Jend. Sudirman.
The entry of the private sector into the area was facilitated by an agreement between the Jakarta governor and the management of the sports complex as part of the basic plan of the sports complex's development in 1994.
Yasidi said the money yielded from the cooperation with the private sector ought to be used to finance major maintenance and development of new sport facilities, as from 1984 the government did not made any budgetary allocation for the sports complex.
As for routine operating expenses, such as electricity bills, staff salaries, minor maintenance and taxes, which, in total amount to Rp 12 billion to Rp 13 billion, these can be covered by the earnings from admission charges for the sports facilities at the sports complex.