We will construct around 10,000 housing units in a phased manner

01 May 2016 Editorial Team

What are the new opportunities the city has to offer?
Being a district headquarter and the capital of Uttar Pradesh, Lucknow's key economic areas are administrative and commercial activities. There has been a continuous growth in administrative units (government and private), commercial establishments, service centres, etc. In the near future, we want to develop the city as the IT, educational and medical hub of India. The growth directions for Lucknow have been envisaged towards the northern, western and southeastern directions. Future growth is envisaged in Kanpur Road, Sultanpur Road, Hardoi Road and Faizabad Road, as new developments in the form of townships and apartments can be seen in these areas. Meanwhile, to ease growing traffic problems, we are planning to construct an outer ring road that will boost development in all parts of the city. Currently, growth corridors pass through the eastern, western and southern directions.

In addition, the corporation will receive Rs 110 crore from the Lucknow Development Authority to tackle the civic problems of 30 prime localities in the city. Projects, including repair of roads and drains and construction of sewer outlets to curb water logging, will be undertaken at a cost of about Rs 77 crore. And, another Rs 40 crore will be used to maintain a proper sewer and water supply system.

Of the current budget of Rs 2,226 crore, how much have you set aside for infrastructure upgrade?
In April last year, we passed a budget of around Rs 1,665 crore; however, we revised it to Rs 2,226 crore. We have earmarked around Rs 30 crore for repair and maintenance works for drainage and sewer pipelines; Rs 8 crore for construction of new roads; Rs 10 crore for improving and laying new traffic infrastructure; Rs 5 crore for cleanliness; and about Rs 2-3 crore for maintenance of parks. Meanwhile, to resolve the escalating water supply problem, we have already completed a few water supply schemes under JNNURM worth Rs 640 crore.

Under Swachh Bharat, the corporation has built 233 public toilets. Any plans to further escalate the count?
The city has put up only 233 public toilets under the Swachh Bharat Mission. However, we are planning to submit a plan to avail the benefits of the scheme considering 43,300 urban households, which have no toilets, and around 50,500 houses, which still use pits or insanitary toilets. We plan to build individual toilets costing around Rs 8,000 each, under the mission.

Please shed some light on the new projects envisaged for the city.
Currently, we are working on a number of housing scheme projects for HIG, MIG and LIG sections. We have decided to develop over 10,000 residential and commercial units in the city. In the first phase, we will construct around 2,500 homes at a project cost of around Rs 250 crore. We have already floated the tender and work will commence soon. Upcoming projects comprising residential, commercial complexes, office spaces and hospital, will be constructed on vacant or minimal revenue yielding lands of the corporation. Meanwhile, to make sure that the plan is affordable and covers all income groups, we have brought it under a self-financing scheme that will have duplexes, multi-level apartments, HIG, MIG, LIG and separate plots as various options. In addition, we are likely to start a housing scheme near the Kanpur-Hardoi bypass area. We have floated the tenders and the cost of the project is Rs 70 crore. We are also coming up with a 1,600 sq m commercial and office complex. The corporation has floated the tender and the cost of the project is Rs 16 crore. To curb electricity expenses, LMC is constructing a bio-gas project for a veterinary hospital at a cost of around Rs 90 lakh. This project will start generating power from next year, and will offer a major respite to the corporation. Further, under the Energy Efficiency Services Scheme of the Central Government, we are converting all streetlights (incandescent bulbs) to LEDs. At present, we have identified two zones, replacing around 12,000 street lights to LED. The project is based on the ESCO model and we have prepared an RFQ, which will be announced soon.

Which landmark project will change the face of the city?
The project that will change the face of the city is a solid waste management plant at Shivri. It is expected that the plant, by the first half of this year, will process the entire city's garbage, which is around 1,300 metric tonne. At present, only 400 tonne is processed at the plant. Meanwhile, the Bharwara sewage treatment plant is also running at one-third of its capacity.

We are making every effort to run both the plants at full capacity as soon as possible.

The city was selected in the 'fast-tracked category' of the smart cities programme. How is the preparation taking shape as the deadline is nearing?
We are currently working on the shortcomings highlighted by the Centre, and will submit the final (reworked) proposal through the fast-track round. The government has asked the reworked proposal to be specific in nature and link already functioning projects in the city along with new proposed demands. We are also considering a detailed risk analysis of all projects, so that each project can be evaluated later in terms of utility.

You mentioned that the corporation has only a single source of revenue: Housing tax. How, then, do you propose to raise the funds for a smart city?
There are a few alternative sources through which we can pull the required funding. We are looking to raise funds through leasing out our land bank for community centres; we are planning around 10-15. Plus, the group housing schemes, which I explained earlier. Leasing out space for advertising and revising the house tax is another option we are considering.

By year-end, through house tax, we are expecting a revenue of around Rs 200 crore, compared to Rs 90 crore a year earlier. I may not be able to divulge an exact figure on revenue generation through group housing and leasing out space for advertisement as the former is still under the construction stage and we are yet to see any traction for the latter.

Meanwhile, considering your funding constraints, are municipal bonds a good option to raise funds?
Yes, they are a good source to arrest funding constraints, but it can be possible only when a ULB has an alternate source of funding other than just housing tax. To cite an example, under AMRUT Yojna, we have received a nominal amount of Rs 100 crore to implement our civic projects. And, if you see the amount of housing and other infrastructure projects we are implementing, this amount is miniscule. Earlier, the Centre used to support a ULB with 50 per cent assistance, which has gone down considerably to 33 per cent. So, it will be difficult for a single revenue source corporation like us, to provide basic infrastructure, with funding gap, to the city. Plus, even if you consider assistance via the 14th Finance Commission, till now, we have received only Rs 27 crore.

This is much lower compared to the assistance we received (Rs 45 crore) in the 13th Finance Commission. However, internally, the corporation officials have some discussions on raising funds via municipal bonds, but at present, have put on hold, as we want to first create the alternate source of funding to receive a better credit rating.

Lucknow city
Year of establishment: 1960
Total city area: 2,528 sq km
Population: 3 lakh
Density: 1,186 per sq km
Decadal growth rate: 27-28 per cent
Administration zones: Eight
Civic centres: One
Municipal councillors: 110 elected + 10 nominated
Annual budget: Rs.2,226 crore
To share your views on this city, write in at feedback@ConstructionWorld.in

- Udayraj Singh, Municipal Commissioner, Lucknow Municipal Corporation Termed as a single revenue source corporation, Lucknow Municipal Corporation (LMC) is leaving no stone unturned to fund the city's planned infrastructure projects through alternate resources. Udayraj Singh, Municipal Commissioner, Lucknow Municipal Corporation, shares how the planned projects will compliment the city's dream of becoming an IT, educational and medical hub, in conversation with RAHUL KAMAT. What are the new opportunities the city has to offer? Being a district headquarter and the capital of Uttar Pradesh, Lucknow's key economic areas are administrative and commercial activities. There has been a continuous growth in administrative units (government and private), commercial establishments, service centres, etc. In the near future, we want to develop the city as the IT, educational and medical hub of India. The growth directions for Lucknow have been envisaged towards the northern, western and southeastern directions. Future growth is envisaged in Kanpur Road, Sultanpur Road, Hardoi Road and Faizabad Road, as new developments in the form of townships and apartments can be seen in these areas. Meanwhile, to ease growing traffic problems, we are planning to construct an outer ring road that will boost development in all parts of the city. Currently, growth corridors pass through the eastern, western and southern directions. In addition, the corporation will receive Rs 110 crore from the Lucknow Development Authority to tackle the civic problems of 30 prime localities in the city. Projects, including repair of roads and drains and construction of sewer outlets to curb water logging, will be undertaken at a cost of about Rs 77 crore. And, another Rs 40 crore will be used to maintain a proper sewer and water supply system. Of the current budget of Rs 2,226 crore, how much have you set aside for infrastructure upgrade? In April last year, we passed a budget of around Rs 1,665 crore; however, we revised it to Rs 2,226 crore. We have earmarked around Rs 30 crore for repair and maintenance works for drainage and sewer pipelines; Rs 8 crore for construction of new roads; Rs 10 crore for improving and laying new traffic infrastructure; Rs 5 crore for cleanliness; and about Rs 2-3 crore for maintenance of parks. Meanwhile, to resolve the escalating water supply problem, we have already completed a few water supply schemes under JNNURM worth Rs 640 crore. Under Swachh Bharat, the corporation has built 233 public toilets. Any plans to further escalate the count? The city has put up only 233 public toilets under the Swachh Bharat Mission. However, we are planning to submit a plan to avail the benefits of the scheme considering 43,300 urban households, which have no toilets, and around 50,500 houses, which still use pits or insanitary toilets. We plan to build individual toilets costing around Rs 8,000 each, under the mission. Please shed some light on the new projects envisaged for the city. Currently, we are working on a number of housing scheme projects for HIG, MIG and LIG sections. We have decided to develop over 10,000 residential and commercial units in the city. In the first phase, we will construct around 2,500 homes at a project cost of around Rs 250 crore. We have already floated the tender and work will commence soon. Upcoming projects comprising residential, commercial complexes, office spaces and hospital, will be constructed on vacant or minimal revenue yielding lands of the corporation. Meanwhile, to make sure that the plan is affordable and covers all income groups, we have brought it under a self-financing scheme that will have duplexes, multi-level apartments, HIG, MIG, LIG and separate plots as various options. In addition, we are likely to start a housing scheme near the Kanpur-Hardoi bypass area. We have floated the tenders and the cost of the project is Rs 70 crore. We are also coming up with a 1,600 sq m commercial and office complex. The corporation has floated the tender and the cost of the project is Rs 16 crore. To curb electricity expenses, LMC is constructing a bio-gas project for a veterinary hospital at a cost of around Rs 90 lakh. This project will start generating power from next year, and will offer a major respite to the corporation. Further, under the Energy Efficiency Services Scheme of the Central Government, we are converting all streetlights (incandescent bulbs) to LEDs. At present, we have identified two zones, replacing around 12,000 street lights to LED. The project is based on the ESCO model and we have prepared an RFQ, which will be announced soon. Which landmark project will change the face of the city? The project that will change the face of the city is a solid waste management plant at Shivri. It is expected that the plant, by the first half of this year, will process the entire city's garbage, which is around 1,300 metric tonne. At present, only 400 tonne is processed at the plant. Meanwhile, the Bharwara sewage treatment plant is also running at one-third of its capacity. We are making every effort to run both the plants at full capacity as soon as possible. The city was selected in the 'fast-tracked category' of the smart cities programme. How is the preparation taking shape as the deadline is nearing? We are currently working on the shortcomings highlighted by the Centre, and will submit the final (reworked) proposal through the fast-track round. The government has asked the reworked proposal to be specific in nature and link already functioning projects in the city along with new proposed demands. We are also considering a detailed risk analysis of all projects, so that each project can be evaluated later in terms of utility. You mentioned that the corporation has only a single source of revenue: Housing tax. How, then, do you propose to raise the funds for a smart city? There are a few alternative sources through which we can pull the required funding. We are looking to raise funds through leasing out our land bank for community centres; we are planning around 10-15. Plus, the group housing schemes, which I explained earlier. Leasing out space for advertising and revising the house tax is another option we are considering. By year-end, through house tax, we are expecting a revenue of around Rs 200 crore, compared to Rs 90 crore a year earlier. I may not be able to divulge an exact figure on revenue generation through group housing and leasing out space for advertisement as the former is still under the construction stage and we are yet to see any traction for the latter. Meanwhile, considering your funding constraints, are municipal bonds a good option to raise funds? Yes, they are a good source to arrest funding constraints, but it can be possible only when a ULB has an alternate source of funding other than just housing tax. To cite an example, under AMRUT Yojna, we have received a nominal amount of Rs 100 crore to implement our civic projects. And, if you see the amount of housing and other infrastructure projects we are implementing, this amount is miniscule. Earlier, the Centre used to support a ULB with 50 per cent assistance, which has gone down considerably to 33 per cent. So, it will be difficult for a single revenue source corporation like us, to provide basic infrastructure, with funding gap, to the city. Plus, even if you consider assistance via the 14th Finance Commission, till now, we have received only Rs 27 crore. This is much lower compared to the assistance we received (Rs 45 crore) in the 13th Finance Commission. However, internally, the corporation officials have some discussions on raising funds via municipal bonds, but at present, have put on hold, as we want to first create the alternate source of funding to receive a better credit rating. Lucknow city Year of establishment: 1960 Total city area: 2,528 sq km Population: 3 lakh Density: 1,186 per sq km Decadal growth rate: 27-28 per cent Administration zones: Eight Civic centres: One Municipal councillors: 110 elected + 10 nominated Annual budget: Rs.2,226 crore To share your views on this city, write in at feedback@ConstructionWorld.in