EU says city of Strasbourg is a bad landlord

27th April 2006, Comments 0 comments

STRASBOURG, France, April 26, 2006 (AFP) - The European Parliament has decided to freeze rent payments to Strasbourg city council for two office buildings on suspicion that it has been overcharged, according to its finance control committee.

STRASBOURG, France, April 26, 2006 (AFP) - The European Parliament has decided to freeze rent payments to Strasbourg city council for two office buildings on suspicion that it has been overcharged, according to its finance control committee.

The decision was taken by the committee's political coordinators after they concluded the parliament has been paying an inflated rent for several years, it said in a statement released in Brussels.

It added that moves to acquire the buildings permanently had also been suspended.

According to the parliament vice president in charge of buildings Gérard Onesta, a French Green MEP, the row centres on a plan to buy the two buildings from a Dutch company, SCI-Erasme, the actual owner, which currently lets them to Strasbourg which in turn sublets them to the parliament.

A price of EUR 136 million was provisionally agreed. This was assumed to be based on the rent paid by the parliament to Strasbourg.

"But on March 7 we learn that of that sum EUR 29 million are going to end up in the pockets of the city hall," said Onesta.

"The EP cannot accept that the price of the buildings is calculated on the basis of rents that have been inflated."

According to the rapporteur on the European Parliament's budget, German conservative Markus Ferber, there could be a difference of as much as EUR 2 million a year between the rent demanded by the city council and what it pays to SCI-Erasme.

Under the terms of a 1979 agreement, ownership of the buildings will revert to the city council in 2047.

At a meeting Tuesday the parliament's finance committee demanded that the city council hand over all the relevant financial and other documents concerning the buildings.

It warned that if these were not forthcoming "within an appropriate time scale," it would lodge a complaint with the European Anti-Fraud Office (OLAF) in Luxembourg. It would also call on the responsible French audit institution to verify the city of Strasbourg's bookkeeping.

Meanwhile city mayor Fabien Keller told AFP that the SCI "is not fully the owner of the buildings, which will revert to the city of Strasbourg for nothing, in a good state of repair, at the end of the long lease."

She said the city had taken a risk in leasing the buildings, one of which had remained empty for three years, and had spent a lot of money in bringing them up to standard.

The European Parliament frequently faces criticism from inside and outside over the high cost of maintaining its Strasbourg headquarters.

To the disgust of many Europeans and a few cost-conscious EU lawmakers, the EU assembly forces thousands of deputies, aides, lobbyists and journalists to swap Brussels for the capital of the Alsace region for one week every month.

However, past campaigns to abandon the Strasbourg site have had no success because a change would require the agreement of all EU governments, including Paris, which is reluctant to give up the prestigious institution.

Copyright AFP

Subject: French news

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