Until recently “Ciudad Guayana” had been submerged under tons of garbage and vultures and was so for more than 3 years. It was a public health problem that got out of hand for the Mayor of the Caroní Municipality.
By La Patilla – Pableysa Ostos
Feb 9, 2023
Citizens had asked the authorities to give priority to solving the garbage problem. And they began to design a ‘project’ to remedy the unsanitary conditions.
Then Fospuca (A trash collection and waste disposal company) arrived at the Caroní Municipality. The plan seemed simple, but ambitious. In Caroní, Fospuca has 37 collection routes to solve the neglect that the municipality had submerged it for lack of a working urban cleaning service. Sources linked to the company indicated that between 800 and 920 tons of solid waste are produced daily in Caroní.
But since the company began operating in the city, a debate has been generated over the issue of rates. The beneficiaries of the service question the methods used to calculate the costs and, above all, the pressure they have felt to pay such onerous bills.
There are sectors that have resorted to introducing injunctions against the blocking of taxpayers in the tax portal of the Caroní Municipality for non-payment to Fospuca. One of the claims was declared inadmissible by the Superior Court of Tax Litigation of Guyana.
Citizen Awareness
The president of the Chamber of Commerce and Industries of the Caroní Municipality (Camcaroní), Catherine Wilson, told the lapatilla.com team that the company provides good service. “We have seen an improvement in the city.”
“I believe that there is a need to constantly disclose the routes and campaigns for citizens, because even though the service is regular and constant, there are citizens who continue to throw garbage in the same spaces where they threw it when the service did not exist. That way you won’t be able to see real change in the city,” said Ms. Wilson.
When asked how she evaluates the arrival of the company to counter the problem of waste in the city, the President of Camcaroní replied: “The city has required compactors for a long time to solve the crisis in which we were submerged.”
Sky High Costs
Wilson points out that from her sector, the problem is not that they do not want the service or that they do not agree with the privatization of urban cleaning. “The problem lies in the cost of the service, which is very high and in many cases really unaffordable. For this reason we have been carrying out a series of actions to sit down with the mayor’s office to seek solutions in favor of the municipality.”
“The mayor’s office is supported by municipal taxes, therefore, we are the businessmen, the taxpayers, who maintain the mayor’s office. We cannot allow more companies to close or go informal, we must find a way to reduce the rates so that taxpayers can comply with it,” said the President of Camcaroní.
While the President of the Chamber of Liquors (Colicor, Liquor merchants) in Bolívar, Franklin Fernández, stressed that the garbage collection service was an indispensable service.
“We were in a situation that warranted the need, whether by public or private means, to be attended to. In this sense, I am not going to question whoever provides the service. What is evident is a reaction of discontent on the part of the users, not for the service, but for the prices of it. We believe that there was improvisation in choosing a method and rates way outside the capacity of the business and businessman of Ciudad Guayana,” said Mr. Fernández.
José Simón Elarba, Director of Fospuca, specifies that “when you measure the performance of the company, it is evident that on average 88% of the inhabitants are happy with the service, although 47% consider that the rates are too high. But they prefer to have the service and pay dearly for it, than not to have it. That’s why we think we don’t have any problem with the service. If it did, we’d be broke.”
Other Visions
The President of Colicor Bolívar also asserted that the liquor sector is the one that has suffered the most from the effects of the pandemic, and in spite of all that, they impose the highest tax burden on the capacity of the municipality’s economic activity, as well as the costs of services.
“We have already stated that we must agree with the government authorities to seek solutions that allow no sector be adversely affected. It is necessary to review the annexes of ruling 008, this determination base and the estimates are not convincing. It is necessary to agree with approaches that contribute to healthy coexistence in our city. We have consulted with a specialist in determining costs and it is possible to adjust and come to a happy conclusion in this situation that overwhelms our companies. It is worth noting that I am an economist and I can understand the situation well. With everyone’s contribution, we can win and beautify our city,” stated Fernández.
While the President of the Venezuelan Federation of Chambers of Commerce and Production (Fedecámaras) Bolívar chapter, Austerio González, recognized their performance and the change that “Fospuca” has caused in the city, but agreed with his colleagues regarding the rates.
“Since its inception, the company has carried out work in accordance with what was planned. We have seen that garbage collection has improved, as well as diminishing the accumulation of garbage in different sectors of the city. What must be evaluated is whether this solid waste collection service is in accordance with what they are charging both companies and industries for this service, and that is where we have the criteria that is not in accordance with what they are charging,” commented González.
For his part, Fospuca sees the start of operations in Ciudad Guayana as successful “in which more than 36,000 tons of garbage have been collected. The company reports feeling satisfied with the more than 4,000 merchants and service providers that to date have complied with their payment commitments, and that is why it ratifies the promise expressed at the end of last year to offer facilities and discounts to those who request this payment agreement. Only to those who pay in foreign currency for a period of one year.
Charge Per Square Meter
The President of Fedecámaras specified that the problem lies in the pricing methodology in the collection of solid waste which is assessed by square meters.
“There are restaurants that if they have 200 square meters or 199 square meters, they charge less than 200 dollars, but if they have 201-210 square meters, we see that they charge you more than 400 dollars. It is an erroneous methodology, it is not adequate, and one must add to this the reality of the municipality.”
In relation to the metallurgical workshops that operate in the industrial zone, Mr. González mentioned that most of them were built years ago, particularly when the basic companies of the Bolívar State had a different reality and were working concerns.
“Years ago the productivity of these workshops and the basic companies were 100%, and this generated a demand for those workshops. But right now they are infrastructures that at best work at 6% or 8% of their production or installed capacity, but if they are being charged per square meter, we are talking about receipts of 800, 1,000 and 1,500 dollars. The same is happening with hotels, clinics, large infrastructures, but with little production,” added González.
It transpired that at the initiative of Camcaroní, after holding work tables between all the chambers that make life in the city and the trash collection company, they agreed to offer commercial users that have rates higher than $200, a 40% discount on their billing for urban cleaning, if they agree to a payment agreement with the company that also includes the sanitary landfill. In this way, Fospuca dismantles the version that the full year of service must be paid to obtain that discount.
“Every merchant whose billing is greater than $200 receives that 40% discount. It is completely false that in order to receive the benefit, the entire year must be paid beforehand,” said a source from Fospuca.
That same source pointed out that “tax evasion is more than 90%. It is this evasion that makes the municipality need to charge people. But we cannot forget that when a meeting was held with the hoteliers chamber, Foscupa granted a 50% discount, the same happened with the clinics and the educational sector (both also received discounts).”
González called on the mayor Tito Oviedo to take action on the matter, because the Caroní Municipality currently does not have ideal economic conditions: the businesses, productive sector, the urbanizations, do not have the purchasing power to pay for this service. “The best thing is to establish consistent rates and then progressively evaluate the possibility of adapting to the productivity of commerce and the state.”
What Do They Propose?
When asked how the rates should be set, Franklin Fernández stressed that “there are several methods, but we must agree on how it adapts to our reality. That’s why I can’t determine a system. For example, there are some costs and expenses that must be disclosed. What we are sure of is that the currently proposed method is not convenient.”
Austerio González pointed out that an ideal system should be sought for charging for the solid waste collection service. “One is by location of the garbage, another by tons/weight of the garbage, and another may be by the productivity of the business or company from which the waste is being collected. It is a matter of talking and looking for an adequate methodology, which does not necessarily have to be per square meter. In the case of Bolívar State, this is not realistic to do it by square meters. It can be viable due to productivity, information that the mayor’s office has in its hands, since they are paid for the (commercial) patent.”
For her part, Catherine Wilson pointed out that she partly agrees with González’s proposals. “One of the options is to charge according to the productive sector in which the trade is located. For example, a restaurant generates more garbage than a travel agency. Study the sectors that generate the greatest amount of garbage: restaurants, schools, clinics, hotels. Another option that has been discussed is to take gross income as a criterion, but since there is currently a lot of evasion due to tax voracity, it will not be a real indicator. I think you have to base yourself on the cost structure of the company.”
“It must also be taken into account that a part of the cost structure, which corresponds to cleaning the streets, squares, cleaning the bus stop, are activities that should correspond to the mayor’s office and this entity must assume that cost in 100%. Here we have quite high municipal rates, because they are charging that to the commercial sector,” said the President of Camcaroní.
Ms. Wilson affirms that the part that corresponds to pay to the residential sector, for political interests, is not charged, and the public part that corresponds to the mayor’s office. “So, here the question is also where is the income that the mayor receives from the declaration of gross income taxes that we merchants have to pay each month. Where is that money? What do they do with that money?” Questioned Wilson.
Viable Alternatives
The President of the College of Economists of the Bolívar State, Fidel Hernández, highlighted that they have made some proposals to address the issue of urban cleanliness. One of these is that the feasibility project prepared by the Caroní Municipality’s Mayor’s Office to contract a private company for the collection of solid waste, must be made available and come under the evaluation of citizens. If the project is considered feasible, the estimates, calculations and premises must be honest before implementation.
Another of the options analyzed is that the methodology for calculating the rates must correspond to the payment capacity of the inhabitants of the municipality and the costs plus expected utility of the contracted company.
“While the previous points are developed, suspend the collection of fees by the contracted company, and that the costs and expenses incurred during the next 6 months, be considered within their initial investment (15 million dollars, according to what was published in a press statement), as well as the working capital necessary for the start-up of the project.”
“Possible savings in the operating costs of providing the service should be considered, such as exchanges with specialized mechanical workshops for preventive and corrective maintenance of the compactor and automotive units, supply of uniforms, footwear and other supplies for the personnel, incidence of the separation of waste by communities and organized unions before it is collected by the service, etc. This would be a first approximation to the evaluation and proposals in the economic and financial field for the collection of solid waste in our municipality,” highlighted Hernández.
What People Think
Lapatilla.com had access to a survey carried out on some 990 people by Datincorp.com, which was requested by local businessmen, although the base of the survey was focused on the political situation, some questions regarding Fospuca were attached to it.
One of the questions was whether the respondents knew the company that collects solid waste in their sector: 76.2% answered “Fospuca”, 18.2% indicated “they did not know” and 5.6% chose the option of “another name”.
On the quality of the service provided by the company: 42.3% indicated that it was “good”, 24.2% described it as “regular” and 16.5% as “excellent”.
Regarding punctuality, 36.3% mentioned that it was “good”, 27.4% described it as “regular to good” and 15.9% evaluated it as “excellent”. And finally, the issue of rates was qualified by 47.2% of those surveyed as “unfair”, 24.8% indicated “not knowing” and 16% as “moderate”.
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