...Cool and rainy!...

ISSUE #530: Oct. 5-11, 2014


Brian Timmons, Newsletter Author
Brian Timmons

Dear friends,

When I started Residencias Los Jardines, I started writing a weekly news letter -determined to tell all the good, bad, and the ugly. I knew some readers would be interested in the construction process. I expected others might be interested in the lifestyle of two people who had decided to live outside the box. For others, the adventures of Lita, the parrot and the cat took on an entertainment saga all its own.

Residencias Los Jardines is finished. We periodically have resales and rental availability. Some readers may be interested in this information.

Brian Timmons
Residencias Los Jardines / https://www.residenciaslosjardines.com info@residenciaslosjardines.com


Featured house this week

Paradisus Condos / Rohrmoser

Paradisus Condos - click to visit

Paradisus will consist of 4 towers in Rohrmoser, a suburb to the west of central San Jose. Not far from the US Embassy and shopping malls, Rorhmoser is a residential area that was developed in the 60's and 70's and is currently seeing significant re-development with high end condos. It is the area where the new stadium and a number of luxury high rise condos have recently been built with more on the drawing boards. Phase one of this development is nearing completion; it consists of two towers and the amenities -pool, exercise room, etc. Tower one is expected to be completed in January and Tower 2 should follow in February / March. The location of this development is superb... it's off the main traffic paths and sits on a ravine overlooking a river. To the east is San Jose / Heredia; to the west is Pavas / Escazu. With floor to ceiling windows and a wrap around balcony, these units offer fantastic light and views.

Each of the units consists of two bedrooms / two bathrooms, and a large living/dining/kitchen area. The floor plan of each of these units has eliminated the optional "den / office" divider. The result is a larger area offering more flexible furniture arrangements while still maintaining the option of including an office area. At 105m2 plus two parking spots each and storage locker, they offer a great opportunity for someone seeking views, security, central location, and first class, all round living...

Read more about Paradisus Condos


Residencias Los Jardines
Property Management, Rentals, Re-Sales

Market Activity

Sales: no inquiries.

Rentals: For whatever reason, I had lots of calls for 2 bedroom units. I heard from agents I hadn't heard from for months and months... I only had one unit and had 5 clients interested in it.



Unit #114: $235,000 / See Unit

Unit #116: $214,000 / See Unit

Site Plan



UNIT #114
FOR SALE $235,000

Total Area (Sq Ft): 1290
Total area (Sq M): 120
Bedrooms: 2
Bathrooms: 2
Floor(s): Single Floor
Type: Attached
Furnished: Yes

This 1,290 sf. (plus covered parking for one car and two lockers 67 sf.) single story, semi detached house, with garden terrace, two bedrooms is a beautiful executive style home. This home consists of two large bedrooms one with six piece en-suite bathroom with additional access to separate full shower. Each bedroom has large closets with extensive built-ins for personal organization. The vaulted living room and bathroom ceilings provide a feeling of grandeur while allowing the warmer air to rise and exit through the ceiling ventilating system. There are four TVs (one in each bedroom, one in the living room and one in breakfast / dinning room.) This is a beautiful well appointed home.


UNIT #116
FOR SALE $214,000

Total Area (Sq Ft): 1290
Total area (Sq M): 120
Bedrooms: 2
Bathrooms: 2
Floor(s): Single Floor
Type: Semi-Attached
Furnished: Yes

This 1,290 sf single floor home includes a 300 sf front terrace plus parking for one car and a separate, secure storage locker. It is and end unit and therefore attached on only one side by a 6 inch cement demising (common) wall, which prevents sound transfer.


Our Lives

WEATHER: ​It's been mostly overcast with rain and drizzle​.

Car: post script: the purchaser called two days after he drove off to his home near Panama. He said the car performed perfectly and he was delighted. I thought this was a very nice jester on his part and says a lot about the person... and I'm also glad he's happy...

We're off to our favorite beach resort this week and hosting friends through whom I bought the car. One is a tica and the other is Guatemalan... neither has been to Playa Carrillo so it will be a double treat for them.

Los Jardines is full now. We've had a flurry of rental demand over the past two weeks... and I've had three owners drop buy to pick up their rental profits... it's always nice to take a holiday and return with money...


News Items of the Week

1. One reader's reasonable critic of CR's current status...

2. Merit Pay... isn't it wonderful when 99% of government employees "deserve" and actually receive merit pay? Obviously the selection and training criteria are excellent...

3. Boruca becomes Varaguas which becomes Diquis which since the 1970's is still being planned but not talked about with the maybe landowners (aboriginals) -they don't have many rights in CR when the rubber meets the road... and 5,834 acres are to be flooded... The original plan (to generate power for Alcoa) morfed into exporting surplus power to Mexico, and now, morfed into for use in CR and for export...

4 / 7:  $1/2 billion Foreign lawsuits against CR government: and now Solis is off to Canada to attract investment when a well publicized lawsuit by a Canadian gold miner over arbitrary cancellation of mining permit is in the recent headlines...  wow!!! what gaul...

5. Compensation a la CR: 15 years ago CR said it would assume responsibility for health related issues due to certain pesticide use between 1967 - 1979 -fully 47 years ago. For the past 15 years, the government has not paid... now the Sala IV ordered the government to resolve the issue... yeah... nearly all affected are now dead..

6. Government Revamping: two incompetent / overlapping government agencies are going to be rolled into one... what an improvement...

8. The court said the government couldn't cut it's budget proposals to them... How successful is the government going to be in reducing it's 19% proposed increase?  My guess... not more than a couple percent... thus the rating agency downgrades with a "negative" bent.

9. Study of Competetiveness: There is lots of information as to what areas are negatively affecting the country... but in typical government fashion they are going to "study" it and perhaps devlp. a plan to make a plan...

10. ICE really wants to raise electricity rates but the government now is on the hook for holding the line... remember, it was recommended that ICE mothball 4 thermal stations because they could buy electricity cheaper from Panama... nope... that won't happen...


1. The time has come for Solís to act

Dear A.M. Costa Rica:

I read your article about "some modest proposals for cutting the budget" in your Oct. 1 edition and felt invited to come up with ideas how to solve the national problem.

As a retired economist from the Netherlands, I followed the political and economic issues in this country with above average interest for approximately 20 years now.

I fully agree with your statement that "the political establishment (and in its slipstream the entire pubic sector) has enriched themselves for so long at the expense of the private sector that you can hardly expect them to reform."

The country has reached or may already be over the acceptable limits in charging the private sector for financing the overprivileged public sector.

With the uncontrolled growth in budget deficits and pubic spendings, this country has many things in common with Greece some year before the collapse. Greece was saved by the European currency member states, but Costa Rica is certainly not "too important to fall" and has to find the solution in itself.

Crucial is that Costa Rica pretends to allow itself European social benefits for their workers (pensions, the Caja, labor laws) but apparently using U.S. tax rates to finance.

European countries can only finance their social security system with tax rates higher than 50 percent for the middle and higher income groups, and pensioners have to pay a full contribution to the medicare, as everybody does.

The highest income tax rate in Costa Rica is, as far as I know, 25 percent, and all pensioners are exempted to pay for their medicare.

In Europe the retirement age is going up towards the age of 70 in order to keep the system financial stable. In Costa Rica however it is a national sport to retire between 50 and 60 years old (keeping the full salary as their pension), specially for the higher (public) income group.

It is obvious that this country can only survive by breaking down the many privileges especially those of the public sector and also by higher taxes for higher incomes (mainly in the public sector). Because of its leveling effect, it will keep the private sector motivated to contribute as well.

It is very disappointing to hear that the new president comes up with old ideas to charge other and new taxpayers for the public spendings. It won't help if you don't level out the privileges and eliminate the corruption.

Voters might easily become misled by politicians, but taxpayers won't. Voters might go into the streets and stamp with their feet, but taxpayers don't. They just reduce their contributions if they feel insulted by politicians.

And this is precisely the situation where Costa Rica stands today.

If no drastic steps are taken, the system will collapse. And that will mean that many public institutions and workers will be closed and laid off, pensions will be cut, and inflation might rise when government might seize the instrument of monetary funding. In a certain way, this will also lead to an elimination of privileges as well, but the process will be fully out of control with many unexpected and unwanted side effects.

Earlier this year Costa Rican voters choose for a drastic change, and it is now up to the president to perform. Let's hope that he proves to be as wise as he pretends to be.

Chris Vijselaar

2. Executive gives incentive for good performance to 99% of payroll

99% of employees of ministries and related entities are paid extra per year because of its good performance.

The incentive is in Article 5 of the Law on Salaries of Public Administration.

The article notes that "annual increases will be awarded on merit to those servers who have received qualification at least good, in the previous year, granting an additional step within the same category, up to the maximum salary."

According to data provided by the Directorate General of Civil Service between 2007 and 2012, on average, 99% of workers were rated at least good and, therefore, received the award.

In 2013 there were 22,105 people working in this sector. For next year, the Government budgeted ¢ 267.000 million to pay this incentive, which is enough to give it 100% of the workers.

The game where this amount is included is called "pay for years served."
Questioning Solis. Deputy Citizen Action Party, Otton Solis, proposed, as part of its megamoción, crop this game, in order to force the leaders to select from among its employees the best and not give incentive to all.

"The hierarchs everyone well qualified (...) because the leaders, to disguise them their misdeeds and to not back lawsuits, and nobody takes responsibility, that's what they're my rules in this field, all the world will get excellent and no longer have nails, "said Solis.

The proposed government deputy, who was not supported by the Subcommittee on Financial Affairs, subtract the difference between the amount budgeted in 2014 and 2015 and the balance will lowered by 60%. Thus, the proposed cut was ¢ 26,198,000.

Both should be reviewed minister, Fallas, as general secretary of the National Association of Public and Private Employees (ANEP), Albino Vargas, Helio recognize that the evaluation system should be reviewed.; however, disagree with Solis on implementing the change through the budget.

"We disagree that this issue be debated Heat Budget of the Republic because it has great ideological charge against public employee," Vargas said.

"You have to make a new system within the service Vargas added performance evaluation to highlight excellence, productivity, efficiency and effectiveness versus mediocrity."

In the private sector, the incentive system is directly related to compliance with pre-established performance goals, said Federico Chavarria, consulting partner at Deloitte.

He explained that usually the balanced scorecard (balanced score card business) or focus competency management approach is used.

According to the Quarterly Business Pulse Business Survey, published in August 2009, the Costa Rican Union of Chambers and Associations of Private Enterprises in the country just under half (42%) of private companies had at that time with some extra-wage compensation plan.

3. Hydroelectric megaproject Diquís hurry the Government

On one side, an energy emergency with consequences for the corporate money and families. Another, frictions with the rights of indigenous communities, environmental impact in the south and an inconclusive debate about what energy source for the near future to develop the country.

In this landscape the government of Luis Guillermo Solís, avoiding express a clear position on the hydroelectric megaproject Diquís moves, but reveals the intention of advancing the energy requirements stranded complex that three years and could generate 650 megawatts.

Although favorable positions authorities of the Instituto Costarricense de Electricidad (ICE) and the Ministry of Environment are already known, Solis prefers not to reveal his personal opinion on the project ("not to entangle the discussion") and argues that the Government requires more analysis between institutions.

However, in a brief interview Friday, Solis gives some signs: "The Government wants to ensure energy supply security, clean energy (...) The Diquís is a very important part in that debate. You do not want to run out of energy, "he said.

The President found it necessary to rush the process of compulsory dialogue with representatives of indigenous communities and accelerate internal discussions within the Government to be clear at the beginning of 2015 This analysis is linked to the national dialogue on electricity.

"We will not have a second chance and we must seize the opportunity we have. I'm confident to go for the right choice, "he said without breaking your caution about the works to be undertaken in the cantons of Osa Buenos Arias, and part of Perez Zeledon.

This verdict, however, is conditional on the results of a mandatory consultation of indigenous peoples, for 915 acres of their lands would be flooded for the dam on river basin Térraba. This query seems far from done yet, according to the president of the National Indigenous Council, Donald Rojas.

"With the new government that (the table of dialogue with indigenous) has not resumed yet. First you have to agree to make a community consultation about choosing the methodology for conducting the consultation after Diquís. This can take years, "said Donald Rojas.

Solis admitted that there are environmental considerations, as the project includes a 5,838-acre reservoir and other works on the environmental impact Sierpe National Wetlands.

The megaproject Diquís is the current version of a plan born from the 70s which was originally called "Boruca", linked to the metals company Alcoa. In the 90s, with Japanese assistance, it was redesigned and focused on selling energy to Mexico. Then he turned to redefine the name Veraguas, later christened "The Diquís" as it is known Térraba basin.

The development of mega Diquís is not the only decision pending on energy. The rising price of electricity has accelerated the debate on energy supply and alternative sources, but there are open questions with hydrocarbons ask or not to join the Venezuelan Petrocaribe or continue or not the plan questioned a joint refinery with a company China state.

4. Costa Rica faces demands for $ 500 million abroad

The five lawsuits against the State of Costa Rica, which are processed by the International Centre for Settlement of Investment Disputes (ICSID), total claims for $ 503 million, ie, ¢ 272,000 million.

These processes, known as international arbitration would cost ¢ 3,500 million to the country in legal advice, to carry them all to term at the ICSID.

The process management is the responsibility of the Ministry of Foreign Trade (Comex) and your budget includes the costs of legal, economic, travel expenses, and the annual payment for the arbitration center.

As for cases, stands a claim for the mining company Infinito Gold against the country by the cancellation of the contract to develop the Crucitas mine in San Carlos Cutris.

Also, is the demand for company SyC Vehicular Technical Review by the lack of electricity rates and the management of gas companies for alleged disrespect to international standards of trade in the product.

The list is completed with the claims of private land owners who were expropriated by the state. They claim to ICSID lower payments for their land, a consortium with interests in Windows and Large beaches in Guanacaste, in Esterillos, in the central Pacific.

Amounts. Infinito Gold Ltd. The Canadian industry in the country requires a payment of $ 93.9 million, while Riteve want to be canceled $ 260 million.

The Swiss expats shareholders ask for $ 30 million. Complaints of land grabs on beaches totaling $ 119 million ($ 70 million Esterillos, Large and windows $ 49 million).

Alexander Mora, Minister of Foreign Trade, said that four international firms lead the defense of the country in these cases, because one of them won the bid to defend Costa Rica in two processes.

Mora added that defense firms are paid by the whole process. Against Infinity, lawyers charge $ 1.7 million, while protection against Riteve he is earmarking $ 1.4 million.

The process consists of several stages. The state can give in any stage without paying the full amount to the firm, if claimant withdraws his claim. Only the lawyers will cancel the concluding stages.

To defend these processes, Comex allocated in the National Budget 2015 ¢ 1.859 million to settle legal services. To this is added the payment provided for ICSID ¢ 500 million for the administration of the five arbitration cases.

Minister Alexander Mora said the play also pay travel costs and economic services to prepare the defense arguments.

Does the blame? While Comex Minister considers that the fault state is minimal in the generation of international claims, MPs Otto Guevara of the Libertarian Movement and Otton Solis of the Citizen Action Party (PAC), self reproach public administration errors.

"The fault of the administration is minimal, because we are a country of law. So if two people have a dispute or given to blows, take them to court. When we speak of international investors, there are ways to not go down the normal course in the country, and take it to arbitration once, "said the owner of Comex.

For Guevara, is easier to establish state responsibility in cases of expropriation.

"There are cases that could be resolved at home easily and without costs of arbitration," said the legislator.

Libertarian said that in cases of Leatherback, which already lost one against a German couple (had to pay $ 3 million), expanding the protected area without accepting a mixed regime in the properties of private generating those claims and give rise to many more demands.

For Otton Solis, was more direct in pointing out the flaws.

"These are original management errors are glaring, that cost us big bucks, as changes in criteria of a government to another," the official.

He concluded that in cases like Crucitas was a mistake to have accepted inputting mining.

5. Costa Rica promises to compensate sickened banana workers

San José (AFP) - Costa Rica has agreed to pay the medical bills and other compensation for some 12,000 banana workers and their relatives suffering lingering effects of exposure to pesticides in the 1960s and 1970s.

The workers and their relatives were sickened after being exposed to the chemical Nemagon while toiling in Costa Rica's banana plantations.

Vice President Ana Gabriel Zuniga late Tuesday announced the decision to make the payments after meeting with representatives of the sickened workers.

"This is a historical debt owed by the government," she said. "The government is committed to once and for all resolve the situation for the affected families."

Between 1967 and 1979, thousands of laborers who worked in banana plantations owned by multinational corporations in Costa Rica and elsewhere in Central America were exposed to Nemagon, a pesticide linked to sterility, cancer, miscarriage and genetic deformities.

After a long legal battle, victims of the pesticide in Costa Rica succeeded in getting lawmakers to pass a measure promising compensation for continuing ill effects from the chemical, but a decade and a half later they are still waiting to be paid.

Tuesday's meeting was held after Costa Rica's Supreme Court last month ordered the government to take steps to resolve the matter.

6. National Roads Authority’s days are likely numbered

The demise of the institutions would come from the result of a bill being drafted that is receiving significant support, including from the Ministry of Public Works and Transport (MOPT) and minister Carlos Segnini, which have authority over Conavi.

The bill aims to create a large, new institute called the National Infrastructure Institute (INI) which would absorb both of the functions currently conducted by Conavi and the CNC. The INI would be a large government institute, on the scale of the Costa Rican Electricity Institute (ICE).

The bill will be presented to the Legislative Assembly during the first quarter of 2015, and most experts believe the bill, which has the support of the MOPT itself, will pass into legislation. In fact, steps are already being taken towards Conavi’s eventual closure, according to a number of sources.

Randall Murillo, executive director of the Costa Rican Chamber of Construction (CCC), told El Financiero this week that he also believes the closures of Conavi and CNC is the right decision, saying that both institutes have “collapsed” and are incapable of managing the country’s road infrastructure.

Calls for the closure of Conavi began in October of last year, when the Public Ombudsman’s Office, known locally as the Defensoría de los Habitantes, recommended the immediate closure of the institution.

In its report at the time, the Ombundsman’s Office said that lack of investment, poor execution and bureaucracy at Conavi were responsible for the vast majority of the 1,330 bridges in the country being in “deplorable” conditions.

The report continued that Conavi had failed in its administrative function to manage resources and implement infrastructure works to meet the country’s needs.

“By the clear deterioration in the national road network and bridges it can be concluded that Conavi is not able to fulfill its functions in terms of maintenance and upkeep, nor has it achieved acceptable performance in managing new works,” the report continued.

“[…] Irregularities and deficiencies […] coupled with the country’s failing road infrastructure make it clear the need to analyze the appropriateness of the current management model,” the 2013 report concluded.

A more recent report from the International Monetary Fund (IMF) would support this view.

In a report it issued earlier this year, the IMF pointed out that Costa Rica has the highest gasoline prices but the worst roads in Central America. One-third of the cost of fuel in the country is actually tax that is delivered to Conavi, intended for road maintenance and repairs.

7. President Solís to travel to Canada and Mexico seeking foreign investment

October 9th, 2014 (InsideCostaRica.com) President Luis Guillermo Solís announced yesterday his plans to travel to Canada and Mexico with the intent of courting more foreign firms to invest in Costa Rica.

The President’s first trip will take him to Toronto, Canada on October 26th-28th to participate in the Toronto Economic Forum. The president also plans interviews with a Canadian newspaper and television station during the trip.

The President’s Mexico trip is scheduled for December 8th-10th, where he plans to meet with several Mexican companies interested in investing in Costa Rica.

Trade and investment from Mexico has continued to grow in recent years. There are currently 33 Mexican companies with operations in Costa Rica, representing $1.5 billion in investment and 19,000 direct jobs in various fields, according to a recent study.

8. Court officials denounce budget cuts
By the A.M. Costa Rica staff

The Poder Judicial has launched a campaign to protect its proposed budget.

Magistrates of the Corte Suprema de Justicia held a press conference Wednesday to protest a motion in a legislative committee that chopped 4.7 billion colons from the 2015 budget. That is about $8.7 million.

The budget cut was by the Comisión Permanente de Asuntos Hacendarios.

Zarela Villanueva Monge, the president of the court, said that the cuts involve budget areas that already have been established by prior contracts and that if the Poder Judicial does not adhere to the agreement, there will be much more money spent in damages.

Some of the cuts involve budget lines such as security of judicial structures, repair of communication equipment, the medical examiners, and transport of prisoners, officials said.

Francisco Segura, director of the Judicial Investigating Organization, said that the cuts give an advantage to criminals.

The Poder Judicial not only includes the courts and the prosecutors, but it also includes public defenders, investigators, programs for victims, protection for witnesses and even food for inmates who are temporarily in custody.

The Poder Judicial has been under fire for the pensions retirees receive and also the way nearly all employees almost always get merit raises.

9. President launches high-level commission to make country competitive
By the A.M. Costa Rica staff

The president initiated the work Wednesday of a commission designed to improve the competitivity of the country.

It is the Consejo Presidencial de Competitividad, Innovación y Talento Humano The work will be in three parts.

The first, headed by First Vice President Helio Fallas, is the Consejo de Competitividad This includes the ministers of Agricultura y Ganadería, Economía, Industria y Comercio, Comercio Exterior, Obras Públicas y Transportes, Ambiente y Energía and Turismo. There also are two representatives from industry and one each from the Consejo Privado de Competitividad and the Cámara de Exportadores.

The Consejo de Innovación y Talento Humano will be directed by Second Vice President Ana Helena Chacón and include the ministers of Ciencia y Tecnología, Educación Pública, Trabajo, and Comercio Exterior. There will be representatives from the Instituto Nacional de Aprendizaje, the Consejo Privado de la Competitividad, the Consejo Nacional de Rectores, the Unión de Rectores de Universidades Privadas, the Asociación de Empresarios para el Desarrollo, private industry and the Coalición Costarricense de Inciativas de Desarrollo.

Also created is the Alianza para el Desarrollo Productivo y el Empleo, headed by the Ministerio de Trabajo.

The umbrella presidential commission will meet twice a month, and the individual consejos will meet once a month, said Casa Presidencial. The groups are supposed to identify the vision and the objective principles that the country should reach in the medium and long term to be more competitive. They are supposed to suggest programs, priorities and policies involving the various ministries with the same goals.

Also announced Wednesday was that President Luis Guillermo Solís will travel to Canada at the end of the month seeking investors.

10. ICE president backtracks after saying electricity rates would increase by more than 13 percent in early 2015

The executive president of the Costa Rican Electricity Institute (ICE), Carlos Obregón, on Wednesday morning said in a press conference the agency would file a request with the Public Services Regulatory Authority for a 13.2 percent increase in electricity rates for the first half of 2015.

Obregón said the request is based on projections for 2015 regarding operating expenses, electricity importation and fuel purchases for thermal generation.

Minutes after Obregón’s statement, President Luis Guillermo Solís reacted surprised and said he was unaware of ICE’s pending announcement.

Last April before taking office, Solís said one of his first actions as president would be to lower public utility rates. In July, he promised that electricity rates would remain unchanged during the next 18 months.

At noon on Wednesday, during a public event at Casa Presidencial, Solís said he would keep his promise not to raise electricity rates before the 18-month period.

The president denied ICE’s announcement was contradictory to his policy plans, calling it a misunderstanding.

“ICE is planning in advance for their expenses and rates, in case they need to use more oil for thermal generation after the 18-month period. But there will not be any increase [in rates],” he said.

“There is no confusion or contradiction between Zapote and Sabana Norte,” Solís said, referring to the San José locations of Casa Presidencial and ICE, respectively. “It was information that was not fully understood.”

Solís even used his Twitter account to ensure that rates would not increase. “There will not be a change in electricity rates for the 18 months, as we previously stated,” he tweeted.

ICE’s Obregón then told TV Channel 11 that ICE’s request somehow could not affect users: “We foresee that the cost of generation using fossil fuels will reduce, meaning generation using renewable sources will increase. Therefore, we requested a change in the composition of the rates, but this change will not affect rates for our customers.” Huh?

Brian, Lita, the Late Hugo IV, irreverent Vicka, the pigeon toed parrot, Chico II and Chica II

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