Bermuda Real has confirmed that the Minister of Public Works, Colonel David Burch will be addressing the airport mail facility statement made last week, on the contract agreement clause that requires the mail facility to move off the premises by this weekend, or pay penalties.
Minister of Government Reform, Lovitta Foggo delivered the news to MPs in the House of Assembly last Friday. The deadline for the Bermuda Post Office Mail Processing Centre (BMPC) is this Saturday, September 30th.
Criticism surfaced soon after Ms Foggo’s Ministerial Statement that generally questioned why the Government would not consider it cheaper to pay the $600,000 penalty, as opposed to $30,000 a month in rent, plus costs to relocate to Mills Creek.
Reports reaching Bermuda Real indicate that the New Venture House building is owned, or part-owned by Don Mckenzie, whose portfolio includes self-storage facilities in Bermuda, and reportedly another former One Bermuda Alliance MP.
Ultimately, all premises leased by the Government falls under the Ministry of Public Works. When contacted, Col Burch, who was not in the House last Friday, said he “will be addressing and correcting all of the misconceptions while juggling all the other challenges currently being experienced by this Government.”
Asked whether he will speak to the issues in the House today, he said his statement will be delivered next Friday, October 6th.
Meanwhile, in a statement released to Bermuda Real last night, Minister Foggo moved to address some of the questions raised since her initial announcement last week.
She reiterated that “the move is required as a result of an Agreement entered into by the former Government, the Bermuda Airport Authority and Project Co (Skyport) which requires the government to pay rent for a building that it owns”.
The agreement requires the Post Office to move by Saturday, September 30th or pay rent at market rate, which could be in the region of $30,000 per month, during the months of October, November and December.
“If the Post Office has not moved by December 31 then the government must also pay a one-time penalty of $600K and continue to pay monthly rent going forward,” said Ms Foggo.
“If the government stays at the Airport after it pays the penalty, there are other consequences as well,” she added. “The airport project scope will change. Aecon will be released from its obligation to develop and construct the Prefunded Cargo Facility. Aecon will also not have to undertake any maintenance or repair work for the space occupied by the Post Office.”
To be clear, she said: “Paying the $600K penalty, having to continue to pay rent for a government owned facility, and increasing the cost of the airport project overall as a result of an Agreement made by the former government is in real terms too costly a proposition.”
As a result, she said: “Efforts continue towards vacating the space in a timely fashion.”
Her statement follows a Bermuda Real report published earlier this week, that there were more questions than answers on the penalty clause and all of the ramifications attached of it.
MPs were also told that the move is not likely to occur by tomorrow, and that efforts are underway to avoid penalties. Ms Foggo also stated last week, that “no more than a 30-day extension will be requested”.
She also noted that “the Supplementary Estimate to the Budget tabled by the Premier set aside $290,000 to fund the relocation of the mail facility. The debate on the Supplementary E