Nairobi County Governor Anne Kananu is in a race to devise means to save City Hall from being auctioned over Ksh.4.3 billion loans with the Kenya Commercial Bank.
In a report by Business Daily, City Hall now seeks to sell some of its assets to offset the bill to avoid an auction plan.
City Hall is looking to sell its assets in a bid to clear the Ksh.4.3 billion loan they have with KCB.
In 2014, KCB acquired the loan from Equity Bank after giving the County government better loan repayment terms.
Allan Igambi, the County Executive Committee (CEC) member for Nairobi finance and Economic planning mentioned the consideration of developing and issuing a Cess tax that is set to help in the loan clearance.
This plan has been accommodated in the Nairobi City County Medium Term Debt Strategy Paper for the fiscal year that is to end on June 30, 2023. A strategy that seeks to reduce the amount of debt the devolved unit had.
“This paper recommends that we conduct an auction for all obsolete and idle assets and furniture and the proceeds realized to be used to reduce the outstanding loan,” mentioned the document.
Another recommendation was also given by the paper, where it stated that the Cess collection, which is to act as an extra revenue source, should go towards clearing the defaulted loan.
The County government had also presented its case to High Court judge Chacha Mwita, in an attempt to set the award aside. However, the court terminated the application, mentioning that the reason for the delay in challenging the award was unclear.
A fire sale of City Hall’s idle assets was announced after the High Court gave KCB bank the go-ahead to seize and auction prized assets in order to clear the pending loan.
The loan that was confirmed in May 2020 after being published in November 2019,
