June 20, 2019
(CMR) The Cayman Islands Government entered into an agreement in September 2015 with the developers of the controversial Beach Bay project to change the name of Beach Bay Road; among other concessions.
The $200 million proposed five-star hotel development project sees the government agreeing to a package of concessions for construction of the resort at St. James Point. The construction has been a source of contention with recently political meetings being held on the impact of the massive project on the local community. Most recently MLA Chris Saunders (BTW) hosted a meeting last month at the Savannah Primary School hall.
Cayman Marl Road has received an exclusive copy of the 16 page Development Agreement listing a number of offerings and concessions Beach Bay Land Ltd. would be receiving. The agreement was executed by Samuel Rose in his capacity as Cabinet Secretary on behalf of Premier Alden McLaughlin and the PPM lead government at the time.
In March 2016 Premier Alden McLaughlin said government had given considerable concessions, potentially worth $25 million, because it believes in the importance of the project to Cayman and the eastern districts in particular.
One of the concessions is that they were prepared to assist the company in changing the name from Beach Bay Road to “St. James Point Road.”
Government was also prepared to officer considerable assistance with processing of government licenses, building and planning approvals above and beyond what would ordinarily be received by developers. It's commitment to the developer included appointing a Chief Officer level designated person in the Ministry or an elected official/Councillor “acceptable to the company” to assist with the project from the government side. This personal appointee would have access to Caucus and Cabinet “as required”.
The PPM government also agreed to a rebate termed a concession credit at of at least $25 million at 12.5% of CI$200 million. The option was left to the developer on how that concession credit would be applied.
In what has been called “a rather unusual” move; the agreement further stipulated that dedicated planning and building control inspectors – civil servants – would be provided but paid for by the developer. One persons who CMR asked to review the contract found it odd that this was permitted:
“To have building inspectors paid by the entity they are meant to inspect is highly irregular and may run afoul of good governance policies. I'm sure we all wishes that our business and home inspectors were being paid by us so we could manipulate the end result – but that's a clear and unacceptable conflict of interest”.
Another person explained that the person would not be technically employed by the company but the company would have access to a dedicated individual to handle all of their applications; given the scope of the project. However, their salary would be offset by the developer. It is not clear if the developer would have direct access to the inspector.
The agreement does not appear to make any mention of Caymanian staffing requirements upon completion of the resort. The full agreement is available from the below link: