Moving up its protest against a controversial mega-million ringgit convention and exhibition project of the Penang Municipal Council, dubbed sPICE, the Penang BN is taking the matter to the Malaysian Anti-Corruption Commission (MACC).

NONE The project is under the Penang Island Municipal Council (MPPP) and state BN chief Dr Teng Hock Nan ( right ) wants its president Patahiyah Ismail and the officers involved in the signing of the sPICE agreement with developer Eco Meridian to be suspended.

Teng said that state BN Youth has been directed to lodged a report at the MACC Penang office at 10am today.

He said the BN has "very good reasons" to believe that there were behind-the-scene "secret dealings" between the state government and developer, a subsidiary of Malaysia's leading property developer, SP Setia Bhd Group.

BN's allegations were based on various reasons, he said, as the agreement signed on Aug 19 between MPPP and the developer was done in a "hush hush manner".

"Nobody knew about it until the issue was raised by critics. The MPPP councillors also did not know about the agreement and were given a retrospect briefing," Teng said.

"Moreover, the terms and conditions of the agreement, which our legal team gathered during the project exhibition in Komtar, found much of it in favour of the developer," he added. "It seems only the interests of the developer are considered and protected".

According to the BN's calculations, MPPP would suffer losses amounting to RM488 million for the project located in Bayan Baru, where the current Penang International Sports Arena (PISA) is housed.

'Development charges not imposed'

This amount includes an estimated RM450 million for development charges not imposed on the units, which is calculated based on land cost at 30 percent of RM1 million per unit.

Another 3.1 acres of "undervalued" land within the project site would see the building of a five-star hotel.

Teng said the land could have been sold for RM300 per square foot at a total RM40 million, and not RM100 psf at a total RM13 million, resulting in a loss of RM27 million, if the land was valued higher.

Another RM10 million was calculated from estimated losses due to MPPP for having to provide mature land - with infrastruture such as roads and utilities - to the developer to build 450 low-medium cost housing units as part the agreement.

In the agreement, the LMC units are not more than 650sq ft in area, and would be priced at not less than RM72,500 per unit.

Teng said it was also found that in the terms and conditions that the developer could extend the concession period for the project for another 30 years.

After 60 years, the developer could also hand over a "dilapidated old" building to the MPPP, adding that on top of all this, the latter has to fork out RM50 million as seed money to build the centre.

"This RM488 million is a total rip-off and we have not calculated yet the other benefits that the developer will enjoy," Teng added.