An investigation should be launched into the appraisal process of all MRT joint development projects, members of Taipei City Government’s Clean Government Committee said yesterday as they announced the preliminary results of an investigation into the MeHAS City (美河市) and Syntrend Creative Park (三創園區) development projects.
Clean Government Committee member Hsu Chin-huang (徐嶔煌) said that the committee’s investigation had revealed why city-owned land had been undervalued in the appraisal process used to divide profits for the MeHAS City joint development project.
The city is in mediation with the site’s developer, Radium Life Tech Co (日勝生), seeking NT$7.6 billion (US$242 million) in compensation over alleged appraisal fraud.
Photo: Weng Yu-huang, Taipei Times
Hsu said that city land was undervalued because of illegal appraisal rules determined by the Department of Rapid Transportation Systems (DORTS), on whose land the project was constructed.
In estimating future land value, the department simply added bank interest to the appraised value of the land when project construction began, failing to take into account rapidly increasing real-estate prices, he said.
Because similar methodology was widely used by DORTS, a broader investigation into all other DORTS joint development projects should be undertaken, he said.
Committee member Wang Hsiao-yu (王小玉) called for the mediation process to be halted and project land returned to the site’s original owners, adding that she spoke only for herself because the committee’s final recommendations conclusions are still under discussion.
She also said the committee’s investigation had revealed that the main responsibility for the debacle lay with DORTS rather than former Taipei mayor Hau Lung-bin (郝龍斌).
In response to the committee’s findings, Taipei City Councilor Kao Chia-yu (高嘉瑜) of the Democratic Progressive Party (DPP) repeated demands that the city government make public all documents on the division of profits for DORTS joint development projects.
She said the MeHAS case demonstrated that the department could easily abuse its discretion in such cases, adding that making the negotiation process transparent would help the city in its bargaining by subjecting contracting firms to the pressure of public opinion.
DORTS joint development division head Li Cheng-an (李政安) said that while the department’s past actions were legal, it would seek to move the date used for appraisal of land value as close as possible to the completion of construction to ensure profit-sharing more closely reflected market changes, adding that the department had also made its appraisal process more rigorous.
He added that releasing documents relating to ongoing profit-sharing negotiations would be unwise because it could weaken the city’s position if litigation ensued.
Meanwhile, Syntrend Creative Park subcommittee convener Ma Yi-kung (馬以工) said the commission’s probe had found the project to be ridden with procedural problems.
She said the site’s zoning was problematic, at it was registered as a “parking garage” in a technology district and that its “add-on” technology complex was far larger than the “main” parking garage used for official registration.
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