State government’s tweak to DP likely to cost Mumbai civic body Rs40,000 crore for amenities
Government is offering additional developmental rights to landowners on ‘net plot’ instead of ‘gross plot’ basisUpdated: Jun 03, 2018 01:09 IST
The Brihanmumbai Municipal Corporation (BMC) may have to shell out nearly Rs49,000 crore to build public amenities like schools, dispensaries, municipal markets, amenities largely reserved on private land, to implement the Development Plan (2014-34) for the city.
The civic body was hoping it could save nearly Rs40,000 crore of this budget by offering the landowners additional development rights to build these amenities themselves and offer it free of cost to the BMC, under its accommodation reservation policy.
As such the BMC in its draft DP had recommended a policy to incentivise developers for the same by offering development rights on gross plot instead of net plot.
However, the state government while finalising the DP tweaked the proposal by offering additional development rights on ‘net plot’ instead of ‘gross plot’. This tweak, landowners and developers have claimed will make the accommodation reservation policy less viable as it reduces the profits offered initially by the civic body.
The BMC had recommended that landowners be allowed to use Transferable Development Rights (TDR) on their gross plot.
TDRs are issued as compensation to any landowner, if the government takes possession of the land to develop a public utility service on it. This buildable right can be used on any other plot by the builder, or can be traded or sold to another holder.
The BMC had offered incentive TDR of 1 on the gross plot – including the area given up for the public amenity. This provision would be useful for the owners to exploit the plot’s full development potential despite the reservations on it. The state, however, in the final DP tweaked this to TDR of up to 2 but on net plot, land remaining after surrendering the plot for the public amenity.
A senior BMC official told HT that this tweak could come at a heavy cost for the civic body as landowners would not be enthused to part with their lands.
The official said, “We were hoping to save Rs40, 000 crore through successful implementation of the accommodation reservation policy. But the policy can only be effective if the landowners find the incentives lucrative enough to hand over the plot. Sadly, the changes made by the state will impact our policy.”
Nearly 75% of reservations proposed in the 1991 DP could not be implemented due to similar provision of handing out FSI on net plot instead of gross plot, pointed out experts. Overall, only 19% of the 1991 DP got implemented.
Civic chief Ajoy Mehta said the authorities may take a re-look at this provision.
“We will have to wait for the Excluded Parts (EP) of the DCPR to be finalised after the round of suggestions and objections. Following which we could re-look at this provision,” he said.
Bhavesh Sanghrajka, founder and chief managing director of Shraddha Lifespaces, said landowners were being short-changed. “The authorities expect the landowners to agree with the slight increase in development rights they have offered for the reserved plots. However, landowners whose plots are not reserved are able to utilise the entire plot potential. This means that those who have reservations on their plot will have to suffer. There is a need to give FSI on the gross plot in order to utilise the plot potential.”
However, urban development department’s principal secretary, Dr Nitin Kareer, said that compared to the 1991 DP, the provisions suggested were beneficial to the landowners.
“We have upped the TDR proposed on such plots from 1 to 2, so it is bound to be profitable for the land owners,” Kareer said.
The problem also is that since 2016 the BMC has advertised its new proposed rule of offering buildable rights on gross plot. Following this, landowners had approached the civic body and agreed to develop their plots after handing over a portion for public amenities.
City-based senior architect, Milind Changani, said, “Now these landowners will not develop their plot and wait for the rules to be changed in their favour. This impacts the implementation of the entire DP.”