BBMP makes no money from advertising hoardings worth crores

They are everywhere: On buildings, storm water drains, skywalks and parks. But no one knows the numbers, and no one knows how to stop them from coming up, or make money out of them. What’s going on behind the scenes?

A huge illegal hoarding near Ejipura Signal. Pic: Shree D N

This huge IPL hoarding looms above the building next to Ejipura Signal. It’s not one hoarding – they are in plenty. There are no visible license tags or numbers on the hoarding. One such hoarding in a premium location like this costs about Rs 2 lakhs per month to advertise.

As we capture it on our mobile, a person sitting in the shop below stands up, alarmed. He asks, “why are you taking the photo?” He sits back satisfied upon hearing from us that the IPL imagery on the hoarding is beautiful and worth clicking.

BBMP advertisement department and its officials have been in the limelight, ever since its Assistant Commissioner K Mathai began submitting internal reports on revenue loss and irregularities in the advertisement section, to the Palike Commissioner. He submitted his first report on July 1st, 2015, and stirred the hornet’s nest.

In his reports, Mathai pegged the Palike’s advertisement revenue loss at Rs 2,000 crore in last nine years and contended that BBMP could easily earn minimum Rs 300 crore as advertising revenue from all 198 wards. This is way higher than what is being collected now.

BBMP in its this year’s budget has pegged the income from advertising to Rs 145 crore. But the official figures of the annual advertising revenue collected by BBMP in the last six years are as follows:

  • Rs 12.96 crore (2010-11)
  • Rs 32.20 crore (2011-12)
  • Rs 22.76 crore (2012-13)
  • Rs 35.27 crore (2013-14)
  • Rs 21.47 crore (2014-15)
  • Rs 5 crore in the year 2015-16 as on March 1st, 2016.

Source: Response to a starred question by Minister for Bengaluru Development K J George in the Legislative Assembly.

This shows that the actual revenue potential from advertising, projected potential and actual collection are three different things.

When BBMP has the potential to generate much higher ad revenue, what is stopping the Palike from collecting the revenue? What are the loopholes that need to be plugged in, to ensure that revenue is not leaked?

How was 300-crore revenue projected?

K Mathai in his third report, gave an example of how advertisement tax of Rs 2.96 crore was collected in a span of 45 days in Shantala Nagar (ward no.111) which so far used to collect merely Rs 15 lakh annual advertising revenue. This figure was then extrapolated to other 198 wards and a minimum Rs 300 crore was projected as the revenue that could be collected annually, by following Shantala Nagar system of revenue collection.

The BBMP’s  Advertisement Byelaw 2006, says that any unauthorised advertisement will attract penalty at the rate of not less than Rs One lakh. “For any general violation with regard to all types of advertisements the Commissioner shall penalise the concerned Agency at a rate not less than the maximum of Rs Two lakh,” the byelaw states.

Till recently, the Byelaw made no mention of removing illegal hoardings. It was only after an amendment was made to Advertisement Byelaw in January 2016, that a clause was added under 3A (7) on penalising and removing illegal hoardings without issuing notice to the advertiser.

In Shantala Nagar, reportedly, the revenue officers identified legal and illegal advertisements and collected tax as well as penalty from the advertisers. However, the illegal advertisements were not removed even after imposing penalty on the advertisers, for reasons unknown.

BBMP has no authentic data of legal and illegal ads

Here comes the interesting part: BBMP unfortunately has more illegal advertisements than legal ones. While there is no clear estimation of the total number of legal and illegal advertisements in the city, a survey conducted by 264 street light teams at the end of 2015 reveals that the total number of hoardings alone in the city is 6,119. Of this, 2,476 hoardings are legal, while rest of them are illegal, the then BBMP Commissioner Kumar Naik had claimed.

Though one cannot certify the authenticity of this survey as we do not have the data of the survey (Citizen Matters has filed an RTI and awaiting the reply). The number of hoardings however, could not be less than 6,119.

In fact, one of our sources who had filed an RTI seeking the same information few months ago, told this reporter that the BBMP did not reply to his RTI query on the list of legal and illegal advertisements, even after three months. “I even approached the appellate authority who imposed penalty on the officials for not furnishing the information. They paid the penalty amount, but did not give information except the zone-wise break up of the number of hoardings,” the source said.

It raises doubts over the kind of hoarding survey that the BBMP conducted. Was the survey by street light maintenance personnel just an eyewash?

10 circulars by the commissioner, yet no action!

The first step in getting rid of illegal advertisements is to conduct a proper survey on all types of legal and illegal advertisements including self advertisements, window ads, petrol bunk ads, film ads, mobile displays etc.

Owing to the High Court and Upa Lokayukta orders to get the list of illegal hoardings in the city, the then BBMP Commissioner (M Lakshminarayana) issued 10 circulars and reminders between October 2014 to April 2015 to the joint commissioners of the eight zones (who are vested with the powers of all advertising-related matters), to provide the list of illegal hoardings in their respective zones. They were asked to scientifically conduct the survey and fill the forms in a specific format.

Some of the directives were – carry out field inspection, write name of the institution, hoarding location, measurement of all types of hoardings (poll kiosk, banner, buntings, self hoardings, commercial hoardings, government owned hoardings etc). The officials were asked to prepare sheets with wardwise information. They were also asked to photograph/ videograph the illegal hoardings.

Amazingly, even after several circulars, reminders and notices warning of disciplinary action against the officials and staff, there has been no list!

After this, IAS officer Kumar Naik took charge as the BBMP Commissioner in April 2015. He ordered a survey of hoardings and the drive against illegal hoardings. He also instructed to appoint new contractors for short-term duration to remove the illegal hoardings and submit report before May 31st, 2015 as per the Chief Minister’s order.

According to the circulars of BBMP Commissioner, if the first step is to identify legal and illegal advertisements, the next is to issue notices to illegal advertisers, penalise them, disconnect BESCOM connection, remove the hoardings and prepare inspection report. Simultaneously, the application for renewing legal hoardings should be accepted, hoardings should be verified and license should be given after the advertiser pays the fee. The circulars mentioned this procedure because the bylaw amendment didn’t explain how exactly should the removal drive be carried out.

No takers for online ad tax payment system

BBMP introduced the online advertisement tax payment system in August 2015, to bring in transparency in the advertisement. The online system has two options—agency registration and renewal and hoarding renewal. But lack of response from the advertisers to take up online license renewal and tax payment system has resulted in further dip in the revenue collection. Mathai attributes the advertisers’ reluctance to pay through online system to the inefficiency of officers.   

Within a few weeks after KAS officer K Mathai submitted his 8th and final report to the BBMP Commissioner on loopholes in advertisement revenue collection and went to media, he was transferred from his post of Assistant Commissioner (Advertisement), back to DPAR.

The transfer order says that he was transferred at the behest of BBMP Commissioner’s letter to the government on April 13th complaining about Mathai giving media statements about the activities in advertisement department, and for tarnishing the image of higher officials. He had locked horns with Special Commissioner Rashmi V Mahesh, who too was trying to fix the problem of illegal hoardings. With Mathai getting transferred and Rashmi going on a leave, the advertising issue has once again reached the cold storage.

With so many issues surrounding BBMP’s advertisement sector, how does the nexus between advertisers, officials and contractors work? Is the flawed tender process and advertisement policy of BBMP, the reason behind this pandora’s box called advertisement? – In the next report.

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