BMC asked to hand over third of Fungible FSI

While the Brihanmumbai Municipal Corporation (BMC) is already facing tough times due to loss of revenues owing to falling crude oil prices, its problems might be further aggravated due to possible loss in its revenues of fungible floor space index (FSI). The state government has asked the civic body to share a third of its fungible FSI revenues with it. The move is likely to have long-term effects on the civic body’s major projects.

In a notification issued on October 20 last year, the state government made it mandatory for the BMC to give it one third of premium collected from grant of fungible FSI. This will affect the revenue collection from the fungible FSI source, said civic chief Ajoy Mehta while presenting the budget for 2016-17.

The fungible floor space index (FSI) means premium levied on extra areas such as balcony, flowerbeds, terraces, niches and voids. It was introduced by the BMC in 2011 with a view to capitalize on the extra FSI that projects were allowed to consume free-of-cost.

According to the civic officials, an anticipated amount of Rs 1,914 crore was expected in 2015-16 from grant of fungible FSI. Till December 2015, the BMC had recovered Rs 1,442.35 crore, while the Slum Rehabilitation Authority (SRA) had collected Rs 217.40 crore. “While the target set was expected to be achieved, the state government’s demand to share revenues will further make a dent in the fungible FSI collections,” said a senior civic official.