A new policy has been introduced to establish guidelines for compensating assets and equipment left on tourism properties when leases expire and the sites revert to the state.

Developed by the Auditor General's Office and now in effect, the policy outlines procedures for calculating compensation owed to leaseholders when tourism properties are returned to or taken back by the government.

According to the policy, compensation will be determined based on the depreciated value of buildings, equipment, and other eligible assets situated on the property.

The policy applies in cases where a tourism lease ends and the property is handed back to the state, or when the government repossesses the site in accordance with applicable laws and regulations.

If a property is deemed operational at the time of handover, compensation may be provided for movable and immovable assets directly related to the provision of services at the site, provided these assets are listed in an inventory maintained under the lease agreement.

In the absence of such an inventory, compensation may be calculated using assets listed in a separate valuation inventory prepared under the policy.

The government may also compensate for movable assets not included in either inventory if the Ministry of Tourism decides to retain them.

The policy also specifies assets that leaseholders may remove from the property and outlines categories of assets that will not be included in the compensation calculation.

The Ministry of Tourism will determine whether a property is considered operational at the time the lease concludes.

Certain assets are excluded from valuation, including:

- Items that are no longer functional and cannot be restored through repairs or upgrades.

- Fixed assets requiring repairs where estimated repair costs exceed 30% of the asset’s projected book value.

- Equipment and goods that have exceeded their specified lifespan according to the manufacturer.

- Obsolete equipment and materials.

- Buildings, structures, or modifications built without ministry approval or in violation of approved plans and permits.

Under the policy, if a leaseholder fails to provide the necessary documents and information for valuation within 30 days of receiving a request, the depreciated value will be assessed based on the asset’s condition and remaining useful life.

Leaseholders will have 90 days to remove, sell, or dispose of items that the ministry chooses not to retain or that are excluded from the compensation process.

The policy states that the Auditor General's Office will appoint personnel to conduct asset valuations. No compensation will be paid until the valuation is completed and approved by the Auditor General’s Office, after which the Ministry of Tourism will release the funds based on the valuation.