After helping President Oscar Arias achieve his biggest win to date, Costa Rica’s mayors are looking for something in return.
More than 20 mayors and other local officials met with the President last week requesting legislative reform in return for their support for the Central American Free- Trade Agreement with the United States (CAFTA), which was approved in a national referendum Oct. 7.
Claiming to represent 74 mayors who signed an August letter supporting the treaty, this group asked the President to pass progressive tax reform and give more resources and responsibility to local governments.
Neither request, it seems, will be granted soon. Legislators have their hands full discussing 12 laws required to implement the free-trade agreement.
“We understand that things can’t happen immediately,” Ana Flor Villalobos, deputy mayor of the mountain town San Isidrio de Heredia, said after the meeting. “We’ll keep making an effort.”
The country’s 81 mayors have long had little power and few resources. Arias, who called Costa Rica one of the most centralized countries in the world, has promised to remedy that. The 2008 budget more than doubles resources for local governments and the Institute for Municipal Development (IFAM). Arias also increased communication with local officials, meeting with groups of mayors in Casa Presidencial three times this year, said IFAM Executive Director Dionisio Miranda.
Still, the meeting last week in Casa Presidencial appeared to bear little fruit. In a letter read by San José Mayor Johnny Araya, the mayors said the free-trade agreement would spur strong economic growth, and they pressed Arias to push laws to better distribute that wealth.
Repeating a request they made in August, the mayors asked for a progressive tax system that would free up state money for health, education, infrastructure and social programs.
There are three tax bills now before the Legislative Assembly, but Arias said he would not push them – or propose other tax reforms – until March, the deadline for passing laws to implement CAFTA. The President said he does not want to alienate the Libertarian Movement (ML) Party, which opposes most tax increases and is a key ally on CAFTA.
Still,Arias agreed that Costa Rica’s tax revenue is woefully low. The Finance Ministry estimates that taxes in 2007 will make up just 14.7% of gross domestic product.
“That’s the tax revenue of a country that can’t be serious,” he said. “With 14%, you can’t build roads. You can’t improve education.
You can’t improve health. You can’t invest more in technology.”
But, he added, until all the CAFTA legislation is approved, “it’s really difficult to talk about taxes.”
Mayors are also unlikely to see a second wish come true anytime soon. In both the August and November letters, the mayors pushed for a law to give local governments more autonomy and resources. A 2001 constitutional reform requires that the state gradually transfer certain authority to municipal governments, while increasing their share of the national budget to 10%. (Municipalities and IFAM will receive 1.5% of budgeted spending in 2008.)
Miranda met with legal experts and mayors yesterday to discuss a possible bill to enforce this constitutional mandate. But the bill is a low priority for the Legislative Commission of Municipal Affairs, where it would be discussed. The commission has not met since late October, and it will likely suspend all sessions until March because its members are busy with the 12 CAFTA bills, said Damaris Chacón, advisor to commission president Gilberto Jerez. Even then, Chacón said, the commission’s first priority is passing reforms to the Municipal Code.
Meanwhile, with few resources and little local authority, mayors must rely on the government’s Cabinet for health services, education, infrastructure repairs and security. But mayors have long said they don’t have enough access to some government ministers.
“I’ve heard a lot of complaints – including from mayors of the government’s own National Liberation Party – that ministers don’t meet with them. When ministers do schedule meetings, they cancel them. A lot of times they don’t even answer (the mayors’) calls,” said Fernando Trejos, mayor of the eastern San José suburb Montes de Oca.
Repeating a promise he made nearly a year ago, Arias said at the meeting that he would work on increasing access to his Cabinet. But for now, he said, he had no solution to this decades-old problem.
“I want to be blunt and speak the truth.”