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| San José, Costa Rica, Friday, Feb. 26, 2010, Vol. 10, No. 40 | |||||||||
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| Costa Rica Expertise Ltd http://crexpertise.com E-mail info@crexpertise.com Tel:506-256-8585 Fax:506-256-7575 |
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Our reader's opinions
Not all developers givebuyers empty promises Dear A.M. Costa Rica Your article yesterday appears to paint most of the Real Estate Developers in Costa Rica over the past few years with a very broad brush, particularly those of us who are trying to develop the Costa Rican Riviera, here on the Pacific Coast. The failure of many of these projects and the loss of money by buyers and investors in these projects can be traced to their flawed business plans. If the buyers had done a minimum of research in these projects they were about to invest in and asked just a few important questions, they would have understood the risk, and just maybe they would have chosen another project. The plain fact is that most of these investors had dollar signs dancing in their heads and were counting their profits before a single shovel had hit the ground. The vast majority of these pre-construction buyers were willing participants in these scams. All of the information and legal structures to protect these folks were available to them, if they had only educated themselves before they wrote the checks. What were these investors thinking? Even the most naïve investor who comes to a foreign country should have asked the developers the following questions: 1. Is the property that you are building on paid for in full and do you own it? 2. Do you have at least 50 percent of the capital needed to build the project? And please provide me with proof that it is in the country and set aside for the project. 3. If you have a bank construction loan, is the property held in trust with a reputable trustee? Can I please have a copy of the trust agreement? Does the trust agreement provide for the release of title for each condominium with the pay down of a portion of the construction loan? This will protect the title of the buyers who have closed on their condominiums if the developer defaults on the balance of the construction loan. This is one of the most important questions buyers can ask a developer. If they don’t get the answers to these questions, I suggest they run out of the office with their hands firmly on their wallets. 4. Is the developer/real estate person making promises regarding future rental occupancy? Is he showing you pro forma cash flow projections that predict that all of your mortgage payments, HOA fees, electric cost, cable cost, insurance cost and property taxes are going to be funded by your rental stream? Sound too good to be true? Well it is. I mention this because there are slick developers where they made just such promises to trick innocent folks into purchasing their condominiums. What do you think are the chances of these promises coming true? How about 10,000 to 1 against it. Yes, there are unscrupulous business people all over the world, and there seems to be no shortage of trusting investors willing to part with their hard-earned money without doing their homework. This problem is not isolated to Costa Rica. Your article makes it sound like there are no honest developers here on the beach. There are developers who are delivering on their promises and completing their contractual obligations. Developers who consider the monies advanced to them as a scared trust. Developers who long ago abandoned the idea of lofty profits and are now concentrating on repaying their loans, finishing their projects as promised, and delivering the best product possible. These developers will be easy to find, they are on the property, willing to answer any and all questions, and they are more than happy to provide the legal documents and proof to back up their statements and promises. We are looking for long-term buyers, discouraging the speculators, open to the folks who have worked hard all of their lives, and as they approach retirement are looking for the same thing that brought us here to Costa Rica in the first place: A chance to enjoy this fabulous country and special people, the clear skies, the warm deep blue ocean waters, the scarlet macaws, parrots, toucans, monkeys, the emerald green rain forest, and the fabulous climate. Yes there are many honest and respected developers here, and we are easy to find. Leo Plumley
Owner/Developer Tres Regalos Beach Club and Condominiums Jacó Beach EDITOR'S NOTE: We appreciate Mr. Plumley's summary of the pitfalls facing buyers. We agree that there are many legitimate developers. We attempt to accept advertising only from companies that we think will live up to their promises. Most of the time we are successful. There also are good people who were blindsided by the economic downturn. Then there are people like Mr. Plumley, who we know would dip into his personal reslurces, if necessary, to live up to his word. Chinese represent danger to Tico culture, environment Dear A.M. Costa Rica: The ever sneaky and inscrutable Communist Chinese have one goal in mind here, and it's not promoting "culture." It's to persuade the Costa Rican government to allow the Chinese to develop our offshore oil deposits in order to feed the insatiable Chinese industrial juggernaut. Oscar Arias is playing a dangerous game by opening the country to Chinese influence. He is putting the sociocultural well-being of present and future Costa Ricans at great risk. For decades, every major human rights organization and Western country has put China at or near the top of worst violators of basic human rights. Let's consider the cultural incompatibilities between Costa Rica and China. (1) Costa Rica disbanded its military more than 50 years ago. China's nuclear-equipped military is the largest in the world and maintains an open ended threat of an attack on Taiwan, (Costa Rica's ex buddy who got thrown under the bus for a soccer stadium), should that country declare its official independence from the Communists. (2) China continues its brutal occupation of Tibet in the face of a half century of international condemnation. Look what the Chinese have done to Tibetan culture! The message is clear: China considers its culture to be superior to all others. What kind of political repercussions could Costa Rica expect from its new best friend were she to criticize China's policy towards Tibet? What sort of respect can Costa Rica expect for its OWN culture from a country like that? This should be reason enough for Costa Rica to close its doors to China. (3) Costa Rica has freedom of speech, freedom of the press, freedom of assembly, and freedom of religion. FREEDOM!!! China's obsession with curtailing/eliminating these rights and crushing those who support them are all too well known and lately exemplified by the cyber attacks on Google. (4) China has the death penalty. Costa Rica does not. China uses convict labor to produce consumer goods for export. Costa Rica wouldn't even think of it. (5) China's record on the environment is nothing short of abysmal. While Costa Rica's environmental regulations/regulatory enforcement leave much to be desired, this country's eco values are far superior to those of the Chinese, who view industrial expansion at any cost as being in the best interests of its people. (Even when they're being poisoned.) China knows that all over the developing world, poverty and cash strapped, overwhelmed politicians mean political malleability and opportunities to buy and manipulate governments and the natural resources they possess. The fact that the Chinese are building a soccer stadium here instead of a hospital is very telling. They are wooing the Costa Rican people by feeding their addiction to football. I think this is deplorable. Once China gets its foot in the door with grants, loans and other "carrots," how does Costa Rica then say "no" to the Communists? On ANYTHING! I would take five minutes sitting in the presence of H. H. the Dalai Lama over a hundred years of exposure to Chinese "culture." Ticos had better wake up to the threat of the dragon at the gate before its too late. Dean Barbour
Manuel Antonio
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Good Grief! You still are spending half your ad budget on paper? You better call us! |
| A.M. Costa Rica third newspage |
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| Starting Monday expats will have to pay for Caja policy |
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By Dennis Rogers
Special to A.M. Costa Rica The immigration law which takes effect Monday includes a new requirement for foreign residents in Costa Rica. To renew residency status, the applicant must show proof of insurance from the government Caja Costarricense de Seguro Social. Permanent status is attained by way of a personal connection with a Costa Rican citizen or by living in Costa Rica for several years in one of the temporary categories. Permanent residents are foreigners who can legally work. Foreigners given residency by way of pensionado or inversionista status are considered temporary residents and cannot work. Both temporary and permanent residents must fulfill the Caja requirement, spelled out in Articles 78 and 80 of the new immigration law. The law also says insurance must be maintained “from the moment residency is granted, in an uninterrupted manner until the moment the card is renewed.” As the Costa Rican Constitution prohibits the retroactive application of law, the requirement presumably takes effect with the new law Monday. However the Caja has no strategy to deal with the large number of Central American residents who will be affected, so the early process will be chaotic. As of Thursday, the Caja’s press office said that the Caja administration “doesn’t have total familiarity with the law and will study it” before commenting on any plans. They are about to get thousands of new applicants. There are two categories of insurance coverage available to individuals not on a formal payroll, Independent Worker and Voluntary Insurance. Independent workers or self-employment coverage is for individuals with economic activity of any sort. Legally any foreigner with such activity should be enrolled with the Caja, regardless of immigration status. There is an additional workman’s comp insurance that is also required, but is not administered by the Caja. Many Costa Ricans engaged in the informal economy, not just foreigners, skirt these requirements. But theoretically pensionados and inversionistas can’t work, so the voluntary policy is the only one available. Voluntary insurance is meant for those not engaged in active work, living from income property, pensions, investments, etc. Both types of insurance cover immediate family members, including spouse, minor children living under the same roof, and adult children up to age 25 who are full-time students. Pre-existing conditions are not covered for the first six months. The biggest difference between the two types of policy is that independent workers receive incapacity leave in the event of injury or sickness serious enough to prevent |
work, while the voluntary insurance holder does not. Both types of policies are “not renounceable,” which means that once the contributor is registered, the only way to stop paying is to be put on a payroll at a formal business. In theory, the Caja can go to court and file a judicial claims process against the recalcitrant debtor’s property and income. Independent workers coverage, documented with the statements an accountant should provide, costs about 21,000 colons for a small businessperson with 200,000 colons per month in net income. All numbers are managed in colons. At the present exchange rate that would be about $38 on a $350 income. For a net income of 500,000 colons, the rate would be about 60,000 colons. If the business nets a million colons, the payment would be about 130,000 colons. In the event of an incapacitation, as long as nine “cuotas” or monthly payments have been made, the policy pays 45 percent of the declared income. Injury has to be confirmed by a Caja doctor. The voluntary insurance cost for just health coverage (no pension or disability) is somewhat lower. The minimum monthly income to get pensionado residency status is now $1,000. At 600,000 colons, slightly more than the $1,000, the policy costs about 36,000 colons a month. A million in income is about 43,500 colons. The equivalent of $2,500, the minimum monthly income amount required for inversionista residency status, is 1.5 million colones and the accompanying policy costs about 71,000 colons. |
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| Signing up for insurance will start at the local clinic |
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Special to A.M. Costa Rica
To apply for voluntary insurance, the first step is not to go fill out applications, it is to identify the clinic that corresponds to your location. There, you will get a piece of paper called a carné de seguro social. Then, you need copies. Copies of your identification card (both sides), the carné, and your electric bill. This should be in the name of the presumed head of household and policy applicant, but they are not finicky in this regard. Bring the originals, too. The electric bill serves to identify the location of your home. Some clinics are considered more desirable than others. Staff members can and sometimes do make you prove where you live right up to showing them in which drawer you keep your underwear. (We are not making this up.) To show your income, the documents you used to get your temporary residency status will have to do. It will take the Caja a while to sort this out. The form to complete is fairly simple: Name, identification number Residence address (Tico style). It helps if you already know the district in addition to your municipality/county. Work address (Should be "none") Address for correspondence Phones, e-mail etc. Section II Information about economic activity: 1. Do you have any income-earning activities? If you don’t put no here, you’re filling out the wrong form for the wrong policy. (Skip to 5) |
 A.M. Costa Rica/Dennis Rogers
Cristian Sandoval will be happy to take your application. He
works in the Caja administration in Santo Domingo de Heredia.5. If you don’t work, explain the source of your income. (pensions etc.) 6. Number of persons in the household. How many work. How many are dependents. 7. Indicate the amount you spend on the following items: a.) electricity b.) water c.) telephone d.) food e.) other. 8. Do you have your own house? If renting, amount of rent. Then list other family members on the policy, fill out the declaration, and sign. If you don’t speak Spanish, it might be good to bring a friend. Do come armed with a lot of patience. Caja employees are agreeable, but lines can be long. Take a number. |
| Some credit the Caja for political stability in Costa Rica |
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Special to A.M. Costa Rica
Often cited as a reason for the country’s stability over recent decades, the Caja Costarricense de Seguro Social is the safety net for health care and pensions. Most who can afford private hospitals and doctors go elsewhere. Anybody who has an accident or takes sick away from San José will be glad the Caja is there. The public health service has all the traits of socialized medicine: long lines, waits for surgery, bureaucracy, sometimes uncaring staff, and even corruption. But the kids get their shots, most expectant mothers are tended to, and most of the doctors are competent. Geographic coverage is exceptional, with a clinic in almost every town of any size and rural outposts called EBAIS ( translated as Integrated Basic Health Attention Team), some not open every day, where a nurse and support staff give immunizations and tend to minor ailments. More serious cases can be referred to a larger clinic or regional hospital. Workers make visits deep into the mountains to immunize children. The hospital in Alajuela is totally new, the decrepit Heredia facility is being replaced, and there are regional hospitals in Limón, Pérez Zeledón, Quepos, Puntarenas, Liberia, San |
Carlos, Cartago, and Turrialba. Medications are usually generic and often of low quality. Laboratories are slow but comprehensive. The Caja is funded by a salary deduction of 5.5 percent for health coverage. An additional employer payroll tax is 9.25 percent. This covers the worker and dependents. There is a “voluntary” program for self-employed and underground workers. Uninsured individuals can be charged for hospital stays and treatment but this seems rare. Operating rooms are sometimes made available to doctors with private patients. Pensions, support for widows and orphans, and disability payments also come from the Caja. These tend to be minimal and are based on contributions. In one case, the Caja gave a widow 115,000 colons ($200) per month after 30 years service by her husband. The biggest corruption case in Costa Rican history involves the Caja. Former president Rafael Angel Calderón and former Caja president Eliseo Vargas, along with another dozen officials, have been found guilty of a giant kickback scheme involving the purchase of medical apparatus from a Finnish company. The trial featured a parade of doctors who said they didn’t want or need the equipment. The convictions are under appeal. |
| Swine flu shots are one benefit of affiliating with Caja |
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Special to A.M. Costa Rica
For the expat who’s been railroaded into paying Caja insurance, what benefits are there? With time and patience, basic service isn’t that bad. It’s all free with no copayments or deductibles. Many doctors work for the Caja mornings and have private practice in the afternoon and evening. Some will even see a patient on Caja time after establishing a relationship privately. There is a good chance they speak English. Don’t expect the same from nurses and support staff. Seasonal flu shots are a normal service. At the moment H1N1 vaccinations are available for patients considered |
vulnerable, which includes those
over 65. Medications are mostly generics but usually work. Some clinics have dental services, but these are limited to what can be done in a 15-minute visit and it can be hard to get an appointment. For more major treatments, waits are long. The administration carefully guards its waiting lists. Some patients have been to the courts seeking a better position on the list. In a phenomenon known as the biombazo doctors are paid off to favor one case over another. In general, waits for operations on conditions not life threatening are measured in months, but can be a year or more. |
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| You need to see Costa Rican tourism information HERE! |
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| A.M. Costa Rica fourth news page |
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| San José, Costa Rica, Friday, Feb. 26, 2010, Vol. 10, No. 40 | |||||||||
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| With a new name for the column come new thoughts |
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| Here’s some good news for all the
people who have written and asked about assisted living
facilities. Up until now there have been few to no real
government procedures for people wanting to build communities for older
retirees. The concept was not even recognized as an entity. But it has suddenly dawned on some functionaries of the Costa Rican government that such communities are in the national interest because they would bring in money and create jobs. (Mexico has long recognized that). There seems to be agreement on this across party lines and simply awaits the president’s signature to activate the process. This eventually may include special tax breaks for foreigners planning to retire here. (Once these tax breaks did exist and were canceled just before I moved here.) Their target market, according to La Nación, will be upscale baby boomers from Canada and the U.S., the latter, especially from Arizona, Florida and Texas. This seems shortsighted to me. Many of these people have already retired to a warmer climate; it is the people farther north who have visited here and would like to experience the climate, as well as the good medical care and hospitality of the Costa Ricans. Well, there are many things to work out before this idea sees reality, and my opinion is ‘build them and they will come.’ Or better yet, don’t build them from scratch. Redesign the existing empty complexes and buildings that are already in existence. Although I am happy the idea may turn into reality, I have my own suggestions (as I always do). Most of the locations they have in mind are in areas quite far from San Jose, near the beach or near the mountains. I think locations closer to the city are a better idea. There are more cultural advantages and activities in the city, as well as stores and any number of hospitals and doctors and dentists to choose from, including the Caja hospitals, since all residents will be required to buy into the health insurance system. And I also think that some developments should be priced for middle-income foreigners who wish to retire here. They also spend money and get involved in philanthropical projects. Speaking of medical care, I recently came upon a Web site featuring Dr. Hans Rosling, a Swedish physician and professor of global health. Dr. Rosling spent many years working in rural Africa as a physician. He is now a specialist in organizing and interpreting statistics, in this case measuring family size, longevity and wealth and their relationship in countries throughout the world. According to the statistical evidence, he said, “health comes before wealth. A country moves much faster (towards wealth) if it is healthy first.” Countries must invest in health first because “it cannot be bought in the supermarket.” Health first makes sense. |
Perhaps you’ve noticed that my column has a new name. The suggestions for "Butterfly" won the descriptive title contest. I do flit about the city, landing briefly here and there, and the musings warn readers that my thoughts are not confined to where I live. I owe a thank you to Fitz in Washington, who was the first to suggest “Butterfly in the City,” and then to Nita, who added the second part, “Musing from San Jose.” And thank the rest of you. I had many that didn’t get into print, but all were great fun. But today I will end with a poem written by my dear friend Mavis Biesanz, who left this planet in February two years ago. She wrote it when I moved from the assisted living facility in San Antonio de Belén back to San José:
Thank you, Mavis. You are missed |
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| Costa Rica seeks to defend its
interests in maritime dispute |
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By the A.M. Costa Rica staff
Costa Rica says that a maritime dispute between Colombia and Nicaragua could have a negative impact on its own ocean territories. So the Óscar Arias Sánchez administration has presented a formal request to intervene in the continuing dispute between the two countries. The case is in the International Court of Justice in the Hague. In late 2007 the international court, the principal judicial organ of the United Nations, ruled that three Caribbean Sea islands disputed by Nicaragua and Colombia, belong to the latter country because a 1928 treaty between the two nations settled the issue. But judges also ruled that they do not have jurisdiction to rule on the sovereignty of three other cays and the delineation of the maritime boundary between Colombia and Nicaragua. Nicaragua had launched action at the court, arguing that it should be granted sovereignty over the islands of San Andrés, |
Providencia
and
Santa Catalina, and over the cays of Roncador, Quitasueño and
Serrana.
The islands are a major resort destination although they are north of
Costa Rica off the Nicaraguan Caribbean coast. Nicaragua chose to continue the case over the areas that the court did not stipulate belonged to Colombia. In 2008 Costa Rica sought the documents in the case, and received them from the court. Edgar Ugalde Alvarez, vice minister of Relaciones Exteriores y Culto, was in the Hague Thursday presenting Costa Rica's request to intervene. The ministry said that after examining the documents it concluded that both Nicaragua and Colombia made territorial claims that affect Costa Rican interests in the Caribbean. Nicaragua presented a map to the court that includes thousands of square kilometers that Costa Rica says is within its territorial waters and in its exclusive economic zone, said the ministry. Colombia, too, has presented documents that infringe on Costa Rican territory, the ministry said. |
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| Tire-puncturing
crooks targeted bank customers By the A.M. Costa Rica staff
A gang of crooks have been working the punctured tire scam for several months in the Central Valley preying mostly on tourists and bank customers. Agents rounded up seven suspects Thursday when they made two raids, one in Isla de Moravia and the other in Guaso de Desamparados, The suspects are Nicaraguans and Colombians. Agents said they recovered suitcases and clothes as well as electronic items that tourists had reported losing. Some of the suspects will be processed by immigration because they appear not to be legally in the country. The method involves a crook puncturing a car tire and then following the victim until the motorist stops to fix the flat. That is when more crooks show up to provide help and to steal what they can from the vehicle. This is a technique that is worked from time to time near Juan Santamaría airport. Agents said that the investigation began late last year when a man said that he lost 500,000 colons when three men and two women arrived to help him fix a flat in Santa Rosa de Moravia. He had just been to the bank. The amount is about $900. This is the second series of arrests this month of individuals suspected of using the same method. Feb. 19 four persons were detained in Sabana Sur as suspects of stealing a woman motorist's purse in San Rafael de Escazú, said agents. The woman had just come out of a bank, too. Those arrested Thursday were identified as Víctor Manuel Ramírez Álvarez, 40, Meylyng Méndez Marín, 30, both detained in Isla de Moravia; Juan Guillermo Cano Ospina, 45, and Farley Arnoldo Castaño Valencia, 34, in Desamparados. The other individuials were remanded to immigration detention. Private security guards found working illegally By the A.M. Costa Rica staff
Police and judicial agents detained 10 persons Thursday in a sweep of workplaces of private security guards. Nine persons were detained for not having the proper permission to do that type of work. A 10th person was detained for challenging authority. Weapons were confiscated because they had not been registered as required by law, agents said. One guard was found working on a tourist visa that had expired, police said. Guards have to be licensed and they usually have to have a permit to carry a weapon. The weapons themselves must be registered. The security ministry maintains a Departamento de Seguridad Privada that handles the licensing of guards. Most of the guards detained Thursday work for private security companies. Firemen contain boat fire By the A.M. Costa Rica staff
A 21-ton boat caught fire Thursday while at anchor in Puntarenas, and most of the interior of the vessel was destroyed. Firemen said the alarm came in shortly before 7 a.m. The boat is the "Puma." Firemen were able to save the boat's four motors from flames. The fire investigators attributed the blaze to contact between a hot water tank and an electrical cable. The heat damaged the insulation on the cable and allowed it to spark. A second boat nearby suffered some damage to paint and a sail, firemen said. |
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Latin American news Please reload page if feed does not appear promptly |
Lawmakers
will consider traffic law again Monday By the A.M. Costa Rica staff
Lawmakers have set aside Monday as a day to discuss the new traffic law. That means the law will come into force Monday without any changes. Some have called the new law draconian because of the stiff fines and possible jail for drunk and reckless drivers. Lawmakers still have 200 motions on the table to consider before taking concrete action. Meanwhile, the Policía de Tránsito said they would not enforce new laws that require child seats, medical equipment and tools in a vehicle until the legal situation is straightened out. Other minor violations will be overlooked,too, they said. Motorists now run the risk of being ticketed for a violation only to have the violation vanish when lawmakers finish their rewrite. There also is a possibility that the current legislature, which leaves office May 1, will retain the traffic law intact for the new legislators to consider. Meanwhile, the Unión Costarricense de Cámaras y Asociaciones del Sector Empresarial Privado called upon the legislature to delay the effective date of the law. That request appears to have fallen on deaf ears because the legislators do not meet as a single body today. The chamber, which represents business said that the law was irrational and created many legal problems if it went into effect. The chamber asked for a 30-day delay, Lawmakers already have delayed the effective date of the law while they attempted to make changes. But that period expires Monday. Police prevent violence at the docks in Limón By the A.M. Costa Rica staff
Police said they intercepted eight men last Wednesday in Limón, and some of the men carried inflammable substances. The situation in Limón has been tense since Tuesday when a new board of directors was declared to be the rightful leadership of the dockworkers' union. The government wants to buy out the dockworkers and put the docks out for bid as a concession. The established leadership opposes the plan. They were elected for a term that does not end until 2011, but the Ministerio de Trabajo said a special session last month had the power to change the leadership. The established leadership is expected to present numerous court appeals, and the directors are continuing to occupy the union offices. The Fuerza Pública said it was working to keep all the routes open in and around Limón. Dockworkers supporting the old regime blocked entries earlier in the week, but the police opened up that route for trucks making deliveries to the docks. The union is the Sindicato de Trabajadores de la Administración Portuaria y Desarrollo de la Vertiente Atlántica. Most of the dock workers are anxious to consider the central government's buyout plan which may mean up to $100,000 in payoffs for long-time workers. However, the substantial numbers of political parties and individuals who oppose Arias are beginning to side with the old union regime. Protests are being planned. |
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