• Friday, March 29, 2024
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BusinessDay

Concerns as building plan approval applicants face tough hurdles in Lagos

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Though a necessary step towards erecting structures all over the world, the long, tough hurdles put on the way of applicants for building plan approval in Lagos, Nigeria’s commercial hub, are raising concerns among private estate developers, especially those who build for profit.

The multiple requirements from multiple government agencies, analysts say, play a critical role in the undue delay experienced by property developers seeking approval for their building plan, and also largely explain why most buildings in this commercial city lack relevant documentations.

Findings by BusinessDay show a long list of requirements that an applicant for building permit must fulfill to have his/her application approved by the government.

For commercial, industrial, institutional, place of worship and residential developments of more than 8 family units, an applicant for building permit must submit layout plan duly prepared by a registered town planner.

He must submit one original survey plan and five photocopies; land use charge receipt, evidence of tax payment, 2 passport photographs of applicant, electronic tax clearance of two directors (for corporate application), company tax clearance (also for corporate application) as well as development levy receipt.

Views are mixed as to the reasons for the long delay in getting this approval which, statutorily, should not take more than 30 days. While some people say the delay is a matter of official procedure, others link it to too much bureaucracy laced with corrupt practices.

“The people in planning approval office are people who know what they are doing, but they don’t do it professionally. They bring all sorts of problems that cause delay. Sometimes you are told that you cannot pay in somebody’s name; that such a person is not paying tax. Sometimes an error in name is detected and that takes long time and money to rectify,” an estate manager, who did not want to be named, explained to BusinessDay.

The estate manager added that “even when you have satisfied all the requirements, they continue to tell you of new things that crop up each new day which is an institutionalized way of making money by people in government.”

He noted that corrupt practices in the system are such that when the officers are asking for money from applicants, they do it brazenly and without shame, recalling how one officer told him that somebody gave them N4 million just to push approval file for him.

“I did not doubt that information because people doing big projects and are desperate can do more than that just to get along with their projects. But the problem there is that these approving officers don’t know the difference between such people and others whose projects are small,” he said.

The estate manager who cited an applicant who spent about 18 months to get his planning approval, noted that there were both official and unofficial payments made by applicants, explaining that the unofficial payment could be as much as 30 percent of the official payment.

“The official fee, I think, is about N1.8 million, but the applicant in question ended up spending up to N2.4 million. The extra is what he used to pave the way for getting the approval proper,” he noted.

But other stakeholders look at the whole process differently. Damola Akindolire, managing director, Alpha Mead Development Company, says the delay in obtaining the planning approval is a function of procedure that is always long and thorough, adding that the application has to move through so many desks, especially if it has to do with a large project, up to 10,000 square metres in which the approving officers have to verify the land title and also ensure it meets environmental requirements.

Akindolire who spoke in an interview with BusinessDay noted that there was inter-agency dependence in processing the application, pointing out, however, that because there were many agencies involved, there is tendency for rent-seekers to ask for gratification which could be interpreted as corruption to the extent that it delays the process.

He cautioned that applicants should be very careful with their application, explaining that a faulty land title could delay the approval because the applicant could be turned back to start afresh. According to him, getting an approval could take any time from 30 days to 12 months.

Debo Adejana, chairman, Real Estate Developers Association of Nigeria (REDAN), South West Zone, noted that corruption was a national issue and, therefore, shouldn’t be a surprise if it finds its way into building plan approval process.

He faulted the state government for involving the state internal revenue service (LIRS) in the approval process, noting that this agency requires too much tax from applicants.

“This can keep applicants at a spot for months,” he said, recalling an experience with the tax agency for which they had to seek the intervention of the agency in charge of Ease of Doing Business in the state.

Adejana pointed out, however, that “in a way, this is justified because there are people who don’t pay tax to the state government, yet they have all the money to do developments. Government gets at such people through this way.”

The delay and demand made on applicants have negative implications. Many property owners would rather avoid these long, tortuous and costly processes which is why, according to analysts, those of them that would, ordinarily, use their property for business transactions cannot do so because the properties are dead in the eye of the law.

Yemi Stephen, Partner at Estate Links Limited, said the process was not quick even though it was, according to him, good as a hedge against building collapse.

“The long delay in getting this approval affects projects delivery time and cost. Dealing with government is not easy. You cannot determine when you get your plan approved. Sometimes you are compelled to ‘shake body’ and that is when the issue of rent-seeking or corruption comes in,” he noted.

He said that the 30-day period for getting the approval was only on paper. “Maybe people are getting it in 30 days, but I have not seen anybody who has. If the process is followed strictly, the 30 days period is achievable, but the rules are not followed,” he said.

A document obtained by BusinessDay further states that, aside from the listed requirements, certain applications will require clearance from some specific government offices or agencies.

These include Land Use Allocation Directorate, Land Services Department, Ministry of Transportation (drawing alignment, gorge, flood plains, river/water bodies, lagoon, shoreline, clearance, etc), Lagos State Urban Renewal Authority (now Lagos Urban Renewal Agency), New Towns Development Authority, and Lagos State Internal Revenue Services.

Speaking with BusinessDay on the whole approval process,an official of the state government said it adds value to property, and also guarantees compensation in the event the property being affected by new development for over-riding public interest.

The official noted further that such property can be entered for business and financial transactions to the benefit of the owner, insisting that with all requirements met, an application takes one month to process.

Depending on the size and location of project, Lagos also requires from approval applicants 5 sets each of architectural drawings, structural drawings, mechanical and electrical drawings (for special application), a letter of supervision from COREN-registered engineers for the structural drawings, and other relevant drawings.

Other requirements include land purchase receipts/title document duly certified by the state’s Lands Bureau, which could be Certificate of Occupancy/Land Certificate, Governor’s Consent to lease or assignment/land conveyance/any other instrument recognised by law

Evidence of payment of land use charge or ground rent (where applicable), copy of soil test report with all pages duly stamped and sealed by design engineer, and Environmental Impact Assessment (where applicable) are also required.