fp Turks and Caicos

The Governor’s Advisory Council was briefed Jan. 28 on crown land policy as the interim government moves closer to creating a new policy to protect “the Turks and Caicos Islands’ major, but rapidly diminishing, natural resource.”

“The council had a briefing on Crown Land Policy from the Permanent Secretary Environmental Resources Mary Harvey and Crown Land Adviser John Llewellyn,” the council said in a press release describing its closed monthly meeting in Grand Turk.

“It discussed options for a new crown land policy, which reflects the importance of the Turks and Caicos Islands’ major, but rapidly diminishing, natural resource and take account of the recommendations of the Commission of Inquiry. The options will be further developed in the light of the council’s discussion, and additional information, before presentation for public consultation and debate in the Consultative Forum.”

There currently is no law governing the handling of crown land in the TCI, except that the land can only be disposed of by the governor or anyone he authorizes. However, there has been a Crown Land Policy controlled by the premier and ministers that had no weight of law.

“That provision has proved to be readily susceptible to ministerial abuse, and has failed to provide an effective means of ensuring effective stewardship of the territory’s most valuable resource,” Sir Robin Auld wrote in his final report of the Commission of Inquiry last year.

Crown Land Policy was first developed in the 1980s to ensure that all Belongers had a chance to buy crown land in a lease-purchase agreement for residential use. A lease purchase agreement required that the home had to be completed in three years to five years, when the lease could be converted into a freehold title.

“The initial rent was to be 10 percent of the discounted freehold purchase price, and the freehold purchase price was set at only 25 percent of the market valuation at the time of signing of the lease; thus, an overall discount of potentially well over 75 percent,” Sir Robin wrote. “However, a further condition of the lease was that the Belonger could not dispose of the land to a non-Belonger within 10 years without repayment to the government of the discounted sum.

The Misick administration changed that policy after it came to power in 2003, so that one minister alone could grant crown land. The policy for commercial land was also changed to allow no grant to be made unless a Belonger had a minimum of 51 percent in the grantee entity, and that a Belonger was to pay no more than 50 percent of the open market value of the land in Providenciales and no more than 25 percent of the value in the other islands.

Sir Robin said those changes “were to give rise to a new species of empowerment of, or of the possibility of abuse by, Belongers in the form of substantial unearned rewards from flipping and/or fronting and otherwise by virtue only of their status. ... Many Belongers acquired several plots, some of which they quickly disposed of for profit to others, including foreign developers.”

In 2005 the Misick government enacted an new crown land policy that said the government “will not actively seek to sell off large areas of crown land, but it reserves the right to do so, if deemed necessary. The proceeds of such sales will be paid into the government reserves fund or used directly for a major specific development project.”

After that, the government regularly sold large tracts of crown land to fund recurrent expenditures — more than $55 million in 2006-07 and 2007-08, Sir Robin reported.

The Terra Institute Ltd. had been hired to propose a new crown land policy, and in 2008 submitted recommendations that would have put strict controls on crown land, making every facet public. Discounts from the market value price of land would go only to Belonger-owned TCI companies with at least 51 percent of income from TCI business. Any company less than 100 percent Belonger-owned would get a discount only for the portion of Belonger ownership. Companies with less than 51 percent Belonger-ownership would get no discounts.

Shortly after the Terra Institute’s report, Auditor Martin Robinson described the crown land process to be in disarray, not following existing policy and losing millions of dollars. Then Gov. Richard Tauwhare relayed his concern to the U.K. Foreign and Commonwealth Office, suggesting that an in-depth investigation was in order.

Sir Robin recommended the adoption of the Terra Institute’s recommendations with some changes, especially that the law should “exclude any ministerial interference in the work of the Crown Land Department in allocating land to persons for lease or sale. … A further and entirely proper assumption was that development of Crown Land, like that of any other land, requires development permission from the Physical Planning Board pursuant to the Physical Planning Ordinance, a requirement that ministers sometimes simply ignore or, on occasion, exert pressure to influence, under the present statutory regime.”

He also said the proposed Crown Land Manual should be made law — not just policy — so that it could not be so easily changed. The law should also “require all corporate bodies and those acting for others in a trustee or nominee capacity to disclose the true beneficial ownership of or interest involved to any public body required or seeking to exercise due diligence in contemplation of the grant of crown land or of development approval coupled with substantial potential civil (including rescission) and/or criminal sanctions for non compliance.”