Hyderabad: The government has cleared a plan for ‘tax incremental financing’ (TIF) in urban local bodies, including the GHMC, to secure public financing for development of infrastructure.
Under the scheme, urban bodies will borrow from finance agencies to build projects. Local property owners will have to pay additional property tax to repay these loans. After the repayment is complete, the extra tax will be withdrawn.
The TIF covers laying of drinking water and underground drainage pipelines, storm water drains, water body development, parks, roads, side walls, street lights, bridges.
The ULBs will identify areas that need infrastructure and consult with locals. Based on the outcome, the ULBs will prepare a project report and put up it to financing agencies.
The AP Urban Finance and Infrastructure Development Corporation will be the nodal agency
On being told about the scheme, residents associations welcomed it but wanted the tax to be less than 10 per cent.
“There was a time when we were willing to contribute even 30 per cent. TIF provides a better option,” said Kamlesh Mehta, general secretary of Green Meadows Colony in Qutbullapur.
Commissioner and director of municipal administration B. Janardhan Reddy said '46,695 crore is needed to upgrade infrastructure from 2015 to 2020. The 14th Central Finance Commission would pay a part of it.
GHMC commissioner Somesh Kumar said '750 crore would be spent this year to provide drainage and water lines in the surrounding municipalities, and '2,500 crore in the next three years.
