The minister of culture announced a plan Monday night to build a new Casa Presidencial just east of Parque Nacional.

The plan came from a commission and will be integrated with an overall plan for the redevelopment of San José.

If adopted, the plan will leave the Centro Nacional de la Cultura as the headquarters of the Ministerio de Cultura, Juventud y Deportes and spare its galleries and theaters.  President Óscar Arias Sánchez said he would like to move the seat of the executive branch from the current location in Zapote to the downtown.

The commission asked in its report that the Proyecto de Planificación Regional y Urbana del Gran Área Metropolitana expropriate the city block east of Parque Nacional. There might be some problems.

Christiane Soto Harrison, who operates the Hotel la Casa del Parque in the former Zeledón Mansion on the northwest corner of the block, said the structure has been designated an historic building.  There also is a theater on the southeast corner as well as several commercial buildings and other homes.

The block is between avenidas 1 and 3 and between calles 19 and 21. The section is called El Carmen.

The commission also said that three ministries that have day-to-day contact with the president should be located in new structures north of Parque Nacional on vacant property that is near the Estación al Atlántico rail terminal.

The idea is to construct a Parque de los Cuatro Poderes. The Tribunal Supremo de Elecciones already is to the west of Parque Nacional. The culture ministry is to the northwest. The Asamblea Legislativa is south of the park.

There was no discussion of budget in the commission report that was released by  María Elena Carballo, the culture minister, about 6 p.m. The executive branch is seeking

X marks the spot designated for a new Casa Presidencial.

new taxes from the legislature and says the country is broke. The previous legislature itself said it needed new quarters because of the disrepair of existing buildings, but the Contraloria General de la República rejected the idea.

The urban development program itself is being supported by a grant of some 11 million euros ($14 million) from the European Union and the equivalent of  7.5 million euros ($9.6 million) from the Costa Rican government.

Eduardo Brenes, who is directing the urban development was credited with creating the concept of the park of the four powers. The ministries that would be located to the north of the park are the Ministerio de la Presidencia, the Ministerio de Planificación, and the Ministerio de Hacienda, the budget and tax-collecting ministry.

The proposal for the president to take over the culture ministry as his offices was controversial and generated protests and demonstrations from those connected with the arts. To solve the controversy, the commission was formed.

The proposal may not be of benefit to Arias. The culture minister said the project might take four years. A contest for design was suggested for architects associated with the Colegio de Arquitectos de Costa Rica.

There has been no comment from Casa Presidencial. Ms. Soto said she had not been contacted about the project, but she said she thought in principle the idea was a good one as long as her family is properly reimbursed for the money they have put into the hotel.

Despite what lawmakers say, today is Mother’s Day for most Costa Ricans. Unlike other holidays that the previous legislature moved to the following Monday, this day is linked to the Roman Catholic Feast of the Assumption of the Virgin Mary. It is a day for Costa Ricans to honor their mother with gifts, flowers and dinners. Monday will be more of a civil holiday as the country takes advantage of yet another day off.

Costa Rica and Panama will kick off the fourth round of negotiations for a free-trade agreement in San José today.

During the negotiations, which will last until the end of next week, the two countries will try to reach agreements on access to markets.

Foreign Trade Minister Marco Vinicio Ruiz called Panama a “very important market for Costa Rica, where our exports have grown in recent years and we maintain a positive trade balance.”

Ruiz said it is Costa Rica’s goal to wrap up the negotiations by the end of this year.

Gabriela Castro, Panamanian Foreign Trade director who is negotiating the free-trade agreement, said this round will have four tables of negotiation: market access, rules of origin, services and investment and public contracts.

Negotiators will debate issues related to the finance sector and international trade, as well as the Costa Rican state telecommunications monopoly.

Costa Rica will come to the table seeking access to public contracts in Panama with its sights on Panama Canal projects.

In 2005, Costa Rica exported $207 million to Panamá, 12.7% more than in 2004. Costa Rica’s main exports to Panama include medicines, electric conductors, food preparation and fungicides.

Panama exported $121.3 million to Costa Rica in 2005, 9.4% less than in 2004. The top imports were medicine, oil and tuna.

-ACAN-EFE

By Amanda Roberson, Tico Times Staff

During a recent operation to combat illegal fishing in Isla del Coco National Park, fish and sharks were discovered trapped in illegal longline hooks around the Isla del Coco area off the Pacific coast, according to the nonprofit marine protection organization MarViva.

MarViva, together with the Costa Rican Coast Guard and the Isla del Coco Marine Conservation patrollers, navigated the area July 24-31 searching for illegal lines. They discovered discovered 50 miles of longline with 1,000 fishhooks and 500 buoys attached where eight sharks and 85 tuna were trapped. Many of the fish died.

A 2002 decree by the Ministry of Environment and Energy (MINAE) prohibits boats from entering the Isla del Coco National Park area, which extends for 12 nautical miles from the island, explained MarViva spokeswoman Michelle Soto. Additionally, Costa Rican law prohibits any type of fishing in national parks.

However, fishermen entering the national park area is “nothing new,” Soto said.

“We’ve seen this in years past, but usually in October and November,” Soto said. “This year we’re starting to see it in July and August.”

Areas near the coast this year have seen less fish, leading fishermen to head outward into the national park area, she said.

The Isla del Coco national park is an “important” area biologically because of its unique plants, habitat for the breeding of marine species and ocean current.

Soto said MarViva will continue working with the Costa Rican Coast Guard and Isla del Coco Marine Conservation patrollers to combat illegal fishing, which harms this unique ecosystem.

By Blake Schmidt, Tico Times Staff

A new chapter in Costa Rica’s half-decade push to overhaul the nation’s tax system opened this week as the Legislative Assembly sunk its teeth into income-tax legislation, part one of President Oscar Arias’ proposed nine-part fiscal reform plan.

The Arias administration will try to breathe new life into legislation that has been lying dead for months, and has introduced controversial new measures of its own into the mix.

After four years of debate by the previous legislature and relentless advocacy by former President Abel Pacheco (2002-2006), the last tax plan flopped when the courts ruled in March that the way the assembly approved the legislation was unconstitutional.

Dubbed “dead” by legislators, the plan was scrapped and fiscal reformists were sent back to the drawing board (TT, March 24).

Now, with the first of the nine bills being debated in the assembly and the Executive Branch tacking new reforms onto old legislation to send to the assembly, the controversial issue of fiscal reform has been resurrected.

However, it faces perhaps stauncher opposition than before, and must make its way through an already packed extraordinary agenda this political season. Like its previous incarnation, which suffered through thousands of legislators’ motions for change, the new proposal is also likely to be remolded as it makes its way through the assembly.

Though the administration has explained portions of its new tax plan, it has been somewhat vague and tight-lipped about it.

“There are projects that have circulated through political circles, but we haven’t had a chance to see them,” said Diego Salto, a partner at the corporate law firm Asesores Fiscales Corporativos, which specializes in tax matters.

The little that is known about the nine-part plan has already drawn fire from real estate interests, bank executives and economists.

Legislators from the Libertarian Movement, which opposed ex-President Pacheco’s Permanent Fiscal Reform Package, are criticizing Arias’ tax plan whenever possible, saying the new administration’s tax plan has less steam than Pacheco’s because of its complexity, and the fact that it must make its way through an already backed-up legislative agenda.

Meanwhile, the Costa Rican government is being pressured from all sides to pass some kind of fiscal reform as the country becomes increasingly conscious of mounting inequalities that have accompanied recent economic growth.

The new fiscal reform plan includes a revamped income tax and a new value-added tax, reforms inherited from the previous plan. Other preliminary pieces of the plan outlined by the Executive Branch are already stirring up skepticism.

A proposed tax on luxury properties – which would be used to help construct housing for those living in slums (TT, June 9) – has brought cries from the real estate industry and raised questions about how the government will assess property values.

Emilia Piza, president of the Costa Rican Chamber of Real Estate Agents, said she found “worrisome” an interview in which Finance Minister Guillermo Zúñiga told the daily La Nación that under the proposed legislation, property owners who report a property value below the market value could be hit with fines.

“Who will determine what is the market value?” she said. “That is supply and demand.”

The Finance Ministry has not said exactly how it would assess market value.

Another proposed 0.5 % tax on all financial transactions in Costa Rica has others wondering what effect such a tax would have on the country’s economy.

Salto said taxing financial transactions could encourage informal transactions with cold cash as a way to avoid the tax. That could mean risky business in a country where mounting insecurity and theft have become a part of the culture.

“In a country like ours – our country does not have a lot of security – the government shouldn’t promote informal business,” he said.

Others in the financial sector also criticized the tax. Bank directors told the business weekly El Financiero that the financial transactions tax would increase the cost of credit.

Trade officials say a proposed 15% corporate income tax on businesses operating in the nation’s free zones will force the country to find new ways to remain attractive to foreign investors once it is ceases to be a tax-free fiscal haven for export businesses (TT, Aug. 4). Proposals for accomplishing this have yet to be determined.

Inherited Reform

The income tax bill, the first piece of reform to be taken up by the assembly, is essentially the same old bill that was drawn up by former National Liberation Party (PLN) legislator Bernal Jiménez during the Pacheco administration. Jiménez, whose term expired in May, touts the bill as a “progressive” way to distribute Costa Rica’s wealth more equitably to combat growing inequalities that have nearly one in four Costa Ricans living in poverty.

It would change the tax percentages on income and reform the system, requiring those who make income outside of Costa Rica but spend it in Costa Rica to declare and pay tax on that income.

Libertarian Movement leader Otto Guevara, a critic of the income tax bill, said the administration’s political capital is “eroding” as it has failed to move any real reform and is now clogging an already packed political agenda by introducing a nine-part plan into the mix.

“To throw fiscal reform into that dynamic is to risk not passing the CAFTA agenda,” he said, referring to the bible-thick Central American Free-Trade Agreement with the United States and accompanying legislation. He said that instead of Jiménez’s reform, his party advocates a “flat tax” – a single rate for all with the exception of the poor, who would not pay any tax. This type of flat tax has been implemented in 14 European countries, Guevara said.

The income tax bill was placed on the agenda last week, but the Executive Branch may end up sending another one because legislators are questioning whether the bill should have a “fast track” procedure to speed up legislation.

Justices of the Constitutional Chamber of the Supreme Court (Sala IV) ruled that the application of the “fast track” procedure designed to speed up the progress of the Permanent Fiscal Reform Package and the approval of the plan by a simple majority, were unconstitutional.

The bill being discussed includes a “fast track” provision.

Clock Ticking

A statement from the International Monetary Fund this week brought further pressure to pass fiscal reform.

While applauding Costa Rica’s current growth trend, IMF officials encouraged Costa Rica to pass fiscal reform and CAFTA to promote more “balanced” growth.

The IMF’s call for fiscal reform echoed a similar call for fiscal change from the Catholic Church last week, when Monsignor José Rafael Barquero lamented growing inequalities in Costa Rica.

The executive has prioritized four parts of legislation to submit to the assembly: the income tax legislation, a $200 tax on licensed businesses, the luxury property tax bill, and a reform of the Code of Norms and Procedures, which will change the way taxes are collected in an attempt to eliminate loopholes.

An agreement reached late Wednesday ended the immediate possibility of a strike by dockworkers in Limón and Moín, collectively the country’s principal port.

The government agreed to give dockworkers the money they are owed from a 2005 accord no later than Sept. 22. Government officials are expected to seek donations from private firms that depend on the docks to seek their products.

The workers also exacted a promise from government officials that a group of high-level officials would visit Monday to discuss ways to strengthen the agency that runs the Caribbean docks in a way to avoid any possible concession that the government might want to give to a private firm.

Workers fear a concession because the government is turning over this week the Pacific dock facilities in Caldera because the country does not have the cash needed to modernize them.

The agreement was between the workers, represented by the Federación de Trabajadores Limoneses and the Sindicato de Trabajadores de Japdeva. The government agency that runs the docks is the Junta de Administración Portuaria y de Desarrollo Económico de la Vertiente Atlántica.

Signing the agreement were Walter Robinson Davis and Rachid Esna for the government and Winston Norman and Ronaldo Bleasar for the unions.

Union workers had engaged in a slowdown, and the central government moved 60 to 70 members of its tactical squad into the Limón area Thursday in anticipation of a work stoppage or blockade of highways.

The Arias administration said Wednesday that it would be happy to pay the money to dock workers once a legal way is found to do so. The fiscal watchdog, the Contraloría General de la República, cut the funds from the Junta’s budget. In addition, a recent Sala IV constitutional court decision has voided much of the 2005 agreement entered into by the Abel Pacheco administration.

Employees of BetonSports gathered in small groups at Mall San Pedro Thursday as they learned that the company would shut down.

Many of the employees had been furloughed since the U.S. government unsealed a 22-count indictment against the firm, its executives and shareholders July 17. But their discussions Thursday centered on if the company would pay the severance money required by Costa Rican law.

Usually an employee who is fired or laid off is entitled to a month’s pay for every year worked, vacation pay, salary due plus a proportion of the annual Christmas bonus.

Also involved were individuals who worked for Millennium, a sportsbook that operated with BetonSports. In all, the firm has bragged in the past that some 2,000 persons, mostly bilingual Costa Ricans and North Americans, worked at the companies in sprawling offices at the mall. The company also does business under other names and Web sites.

Also up in the air are the thousands of bettors, mostly from the United States, who had accounts with the company. They can only hope that the firm makes good on its debts. The accounts contain deposits made in anticipation of future bets and winnings.

The U.S. indictment said that between Feb. 3, 2003, and Feb. 1, 2004,  BetonSports and its related companies took in $1.23 billion in wagers. That would represent about $100 million in bets a month.

The employees were not in a generous mood Thursday. Most felt that BetonSports would fail to pay the severance money. Some had been expecting bank deposits.

The Ministerio de Trabajo confirmed Thursday afternoon that investigators have been looking into the affairs of the company for about a week. A spokesperson said the ministry initiated the probe instead of waiting for complaints. The ministry is in charge of enforcing the labor laws.

A spokesperson for the Caja Costarricense de Seguro Social said that agency had no knowledge of any developments at the company. The Caja receives payments from employers and provides the health, pension and other social security benefits to employees.

There was no confirmation of the closing from the company, which declined comment. But many of the employees who mingled in the mall office confirmed what they had been told in meetings with bosses. The Web site has not operated for three weeks.

The U.S. federal indictment charged 11 individuals and four corporations on various charges of racketeering, conspiracy and fraud. The U.S. government seeks $3.3 billion in back taxes on wagers taken from the United States and $4.5 billion more from other defendants as individuals.

Costa Rica might have trouble finding local assets to use to pay the sportsbook employees. According to the indictment, deposits for bets went to Ecuador, Belize and other countries but not to Costa Rica. This was the electronic hub of the British corporation but it was not the banking center. The bulk of the assets here are computers in the multi-floored Mall San Pedro operation.

Internationally, the U.S. government is likely to freeze the company’s overseas accounts before Costa Rica locates them. One stipulation of the civil order that accompanied the indictment is that the firm return any funds of U.S. citizens that it holds.

At the mall, Costa Rican officials might be hard-pressed to find out who is in charge.  David Carruthers, the former general manager, is in jail in the U.S. State of Missouri. He was named in the indictment and is trying to make $1 million cash bail. He is a British subject and was arrested in Texas while changing planes on a return trip from London. The company said that he had been fired.

Carruthers was an outspoken advocate of legalizing Internet gambling and even wrote an opinion piece to that effect for the Los Angeles Times earlier this year.

The U.S. Justice Department says that Internet gambling is illegal. Sportsbooks here dispute that and until the crackdown last month on BetonSports, many executives here thought they were invulnerable to U.S. criminal and civil action.

A growing concern among Costa Ricans surfaced Wednesday when a radio reporter dared to ask the president if he cared to comment on criticism that he should spend more time at home solving national problems instead of trying to be the world’s peacemaker.

The president, Óscar Arias Sánchez, replied that his critics have to have a small, stingy spirit to label him for fighting to save lives anywhere. War, most of the time, doesn’t have any sense, and no one is going to win, he said. If he had the opportunity to save human lives, the president said, he will take that opportunity. And, he said, he really doesn’t care what his critics think.

Arias, a Nobel Peace Prize winner, had just finished talking to reporters about his weekend trip to Colombia. He went there for the inauguration marking the start of Alvardo Uribe’s second term as president.

Arias said then that he was ready to help the Colombians end their five-decade civil war. He also had plans to meet with a Cuban official to encourage Raúl Castro to enact democratic reforms, according to his Casa Presidencial. That second meeting did not take place because the Cuban official wanted to restrict the topics to be discussed. Arias said Wednesday he did not want people putting conditions to dialog.

The Arias administration also has been quick to criticize the war between Israel and Hezbollah and to push for worldwide controls on small arms.

Arias also has been working on a proposal to have developed nations forgive debts of developing countries if the developing countries agree to reduce military spending and apply the savings to social needs.

Meanwhile, Rodrigo Arias. the president’s brother and minister of the Presidencia, issued a statement expressing pleasure at the results of an opinion poll on the first three months of the Arias government.

The poll, done by CID-Gallup for La República newspaper and the Repretel television group said that 44 percent of those polled thought the Arias administration was doing a good or very good job.

8/10/6

The primary focus of this week is my lawn. The shoots we planted from the side of the road did okay, but isn’t getting thicker, and seems spindly. The seeds we bought came up in about 20% of the area we planted, and everyone insisted it wasn’t Grammia, the type they use for soccer fields in this area. Jose didn’t think so either, but asked an expert. Turns out there are two types of Grammia, one fine, and one coarse. The fine stuff doesn’t do well here, and the seeds only grew in the shade. Jose suggested we get a little bit of sod from his friend in Chomes. I also needed to get some poison for the grubs.
Monday, I went to Puntarenas for a mouse for the computer, Barranca for some money from the bank, and Miramar for the poison. I bought the wrong mouse because I read the box wrong, got half the money I wanted because my Spanish was bad, but did manage to get the right poison.
Tuesday, we went to Chomes for the sod. Jose talked to his friend, the owner of a huge farm, and we drove out into his field, dug shovels full of sod, put them into bags, and loaded them into my 4×4. When we unloaded the truck, we figured we needed 4 loads to do the lawn. On the way back from the second load, the truck made a loud noise in Judas, so I drove it about a kilometer to the mechanic’s house. The bolts had broken on the water pump. We left the truck there, and walked around Judas until Jose found someone who would drive us and the sod home. The mechanic has the water pump on, but the head has to be checked to see if it is warped. I was supposed to know at 10am if that was alright, but when Jose called him, he wasn’t home. If that needs to be fixed I will be without my truck for a few days.
Meanwhile, we spent yesterday afternoon pulling shoots from the sod and planting them in individual holes. Apparently, if you just lay the sod out, it has trouble penetrating the clay and spreading. We could expect half of it not to live. Rafa’s son Diego is helping, it is a very big job. Also, it rained all afternoon, good for the grass, but hard to work in. Jose makes the holes, I put in some poison, and Diego plants the shoots. Well, on the 13th hole, Jose hit the water line. He had a union, and some cement, so we repaired that. We finished up at 4:30pm, and had a good sized patch planted. They came back this morning and worked until 12 noon, getting a lot more done. This time, when Jose hit the water line again, he didn’t have any more unions. Without my car, I couldn’t go and buy more, so he heated up the ends of another piece of tube and used another tube to expand them. He cemented this into the gap I cut out of the water line, and we carried on. His favourite saying is “The only problem without a solution, is death”. Thank goodness he didn’t hit the electrical line.
Anyway, it has been a less-than-perfect week, but I am keepin’ on keepin’ on.

Banco de Costa Rica and the country’s hotel association entered into an agreement Tuesday, and one of the benefits for the tourism businesses is a special rate for credit card transactions.

Carlos Fernández, general manager of the Banco de Costa Rica, said the rate was 50 percent lower than what now is available elsewhere. The special rate is 2.65 percent of the transaction.

Fernández said he hope the hotels respond by  adopting discounts for those who carry credit cards from his bank.

The association, the Cámera Costarricense de Hoteles, also will get special electronic services from the bank. The electronic services will includes online payment of a multitude of government charges, including worker social security, workers’ insurance and payments to suppliers. This is important for hotels far from business centers.

The chamber was represented by Manuel H. Rodríguez. president.