News & Notes 725:Funds and Assets Management Committee (FAMC) Monthly Report

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725 icon.jpg   News & Notes 725
25 November 2017

Funds and Assets Management Committee (FAMC) Monthly Report

October 2017

This month, FAMC along with Working Committee (WCom) presented the document called Code of Conduct (CoC) to the community at a general information meeting. The CoC, implemented on 1 October, is the new avatar of the former Commercial Trusts and Unit Guidelines, 2014 aka “The Guidelines.” The CoC document outlines the responsibilities of trustees and executives in the areas of fiscal and asset management. It also seeks to ensure participatory governance by relegating certain powers as regards the management of Trusts and units to working groups selected by the Residents’ Assembly, namely FAMC and WCom. As the Auroville Board of Commerce (ABC) and the Auroville Board of Services (ABS) have mixed feelings about certain clauses in the CoC, we are initiating again a process of refining the terms and processes so as to ensure a clearer implementation of these guidelines amongst the wider stakeholder group consisting of unit and service executives and trustees.

The end of October marked a year of our group functioning under the 2016 Residents Assembly-approved mandate. In this period, we have, through our experience, discovered certain challenges and shortcomings implicit in the mandate. We have shared our feedback regarding the FAMC mandate with the Auroville Council. To help enable the best outcome in the selection process for new FAMC members in November, we also shared certain key issues with the Residents Assembly Service (RAS) and the facilitators for the selection process.

As of the last week of October, 3 members of FAMC were TOS (temporarily out of station). The month of November will therefore be a period of upheaval and transition with a few current members going out and three new members coming in. To help with this period of transition, we have, with the permission of Auroville Council, requested Ulli and Amy to continue to serve as FAMC members till Dec 9.

Completed issues

Units and Trusts

AuroMira Developers (Auromode Trust), new unit: ABC endorsed and FAMC approved the creation of the unit AuroMira Developers. The executives are: Mr. Jothi Prasad Rajan, Ms. Tomoko Suzuki, and Mr. Sasikanth Somu. AuroMira’s activities are: “Services: carpentry, metal works, plumbing, electrical, architecture, hardware depot; and Production: thermocrete & CLC (cellular lightweight cement).” Most of these activities were previously undertaken by Prasad as an executive of AuroCreation. He will be resigning from AuroCreation to focus on AuroMira Developers. The ABC support group has been asked to follow-up with the remaining executive of Aurocreation, as well as the trustees, to enlist an additional executive to replace Prasad.

Easy Procurement Solutions (Swagatam Trust), new unit: Easy Procurement was an activity, which due to expansion of its activity, is now structured as a unit. The executives are Mr. Balu Kuppusamy, Mr. Iyyappan Jayamurthy, and Mr. Angelo Salerno. The activities undertaken by the unit are: “Procurement, storage and delivery of construction materials and household fixtures and appliances for all manner of construction, repair & renovation works in Auroville.” ABC endorsed and FAMC approved the creation of this unit.

For All Pour Tous Trust, trustee reappointments: ABC endorsed and FAMC approved the reappointment of trustees, Mr. Arjun Puri, Mr. Carel Thieme & Mr. Ulrich Blass. Varuna Auroville, the major unit under this trust, was asked to honour its initial agreement to monitor, with individual meters, all the units that are currently receiving free electrical subsidy through Varuna.

Auroville Online Store (ADPS Trust), executive reappointment: ABC endorsed and FAMC approved the reappointment without term of Mr. Stephan Himmer as an executive of this unit.

Foodlink (Auroville Service Trust), new unit: ABS endorsed and FAMC approved the creation of the unit, Foodlink. The executives are: Mr. Vivek Mishra, Ms. K. Sumathi, and Ms. Bindu Mohanty. The activities to be undertaken by the unit are: “To collect organic produce from Auroville farms and distribute the same to the community with minimum packaging; to process and distribute surplus produce to the Auroville community including offering meals, where the produce is sourced from the farms; to create awareness about local organic food production and consumption by offering educational activities and; to create awareness about “organic” produce and ensure products of the same.” Foodlink was previously operating as an unregistered service activity under the Farm Group. It was noted that if Foodlink were to expand its activities to include an eatery, it would apply for a separate registration of the eatery.

Auroville Road Service (Auroville Service Trust), executive resignation: The ABS asked if the FAMC would agree to the resignation of Mr. Alain Grancolas from Auroville Road Service. In the past the FAMC did not support his request to resign because of his financial skills that are important in the effective running of the unit. In July this year Mr. Jacques Rosier was appointed as an executive and the FAMC have now been assured that Alain will hand over the fiscal responsibility to Jacques Rosier. With this assurance, the FAMC replied to the ABS that it will support Alain’s resignation. The FAMC await the requisite documents from the unit, and Trust.

Cynergy (ADPS Trust), extension of activities: ABC endorsed and FAMC approved the extension of activities of Cynergy to include Software Development, Consultancy, Electronics Manufacturing & sale, and Graphic design and sticker manufacturing and sale.

Joy Guest House (Guest House Trust), executive reappointments: Re-appointment of the executives Mr. Giovanni Scollo Abeti, Ms. Stefania Savardi, Ms. Sara Sponza had been delayed due to opposition from various parties regarding the operation of the eatery Dolce Vita, which is attached to this guest house, as well as largely unresolved conflicts with their closest neighbor, L’aura. The other current executive is Ms. Janet Fearn. After listening to the concerns of everyone involved, FAMC approved the reappointment of these three executives. It was agreed, however, that, barring special events, the eatery would cater only to guests staying at the guest house, and the mediation process begun earlier would be continued in a sincere attempt to resolve lingering disagreements.

Land related

Land Board (LB) new members’ selection proposal: FAMC members have been involved with the selection process along with WC and RAS members. An announcement about this proposal that allowed for greater participation by the RA will be made by this sub-group.

Land purchase: Upon the recommendation of the Land Board, we approved the purchase of IR 295/2 (0.21 acres), IR 295/3 (0.045 acres), IR 255/1 (0.09 acres), which are 3 small plots past Ayyarpadi Farm, bordering the International Zone. We also approved the purchase of BO 23/1A1 (1 acre) in the greenbelt near Dana.

Loans etc.

Anan housing loan: FAMC agreed to give Anan of Eternity a loan of Rs. 5 lakhs payable in 5 years towards completion of a house in Eternity that he’s been building for his use. Yuval, Anan’s father, is a guarantor for the loan.

Bank guarantee request by Buildaur: The architectural unit, Buildaur has been selected by the Indian Institute of Human Settlement to design a part of its first campus in Bangalore. As part of their contract, Buildaur needed a bank guarantee of one-year period for Rs. 9 lakhs. Buildaur asked FAMC to provide this guarantee, within a tight deadline for a response within 1 week. While under certain circumstances, FAMC can provide such a guarantee, we noted that Buildaur has unresolved issues with BCC regarding its contributions to City Services. According to the BCC calculations, substantial contributions to City Services are due from Buildaur. Therefore, the FAMC postponed a decision regarding Buildaur’s request until the contribution issues are resolved.

Credit to Savitri Bhavan extended: We granted an extension until March 31, 2018 of the existing credit line of Rs. 10 lakhs to ensure completion of final phase of Savitri Bhavan master plan as Savitri Bhavan had no outstanding dues to the community.

Auroville Foundation related issues

Goods and Service Tax (GST): After a joint meeting with the Ashram accountants and lawyers, FAMC came to the conclusion that, at the present moment, it is of utmost importance to be GST compliant and ensure GST registration for all entities that fall under GST purview. All entities whether only involved with purchasing or those who have sales plus purchasing must be registered. At present, due to our complex organization with many small activities/units, it seems it would be best to have each Trust have their own individual GST number and to register all units under the Trust with this common GST number. Organizing all this will take time. GST registration for individual units can be considered under exceptional circumstances. FAMC may be contacted for guidance in such situations.

Tamil Heritage Centre construction update: A way forward has been proposed to complete the Tamil Heritage Center construction after many discussions between Bharat Nivas Trust trustees, Mr. Chunkath and Mr. Srinivasmurty (Auroville Foundation), the WCom and FAMC. The FAMC and WCom will take primary responsibility to ensure completion of this building with the funds allocated from the Govt. of India to Bharat Nivas.

Ongoing issues

Units and Trusts

Activities umbrella units’ executives joint meeting: Ananda (Auroville Food Activities), Palani & Hendrik (Auroville Activities), Claudine & Kumar (Auroville Small Scale Activities) met with FAMC to discuss the challenges related to the burgeoning growth of new activities. The executives of the umbrella units are stressed and over-worked, especially as the managers of the activities are not pro-active in following proper regulations. Many activities do not maintain proper accounts and many others do not make any profit, even to cover their minimum monthly contributions or administrative fees. It was decided that Kumar, Palani, and Hendrik along with FAMC representatives, will form a sub-group to do a detailed assessment of the situation and suggest improvements. Some activities managers may be asked to participate in this sub-group to include their perspectives as well.

Red Earth Riding School (RERS), Non-Compliance issue: It was brought to FAMC’s notice that RERS has built and is running a small guest unit without a building NOC (no objection certificate) from iTDC. Also the guest house is not registered with Guest Facilities Coordination Group (GFCG) and is currently not contributing financially to City Services. FAMC has asked iTDC and GFCG to look into this issue and keep FAMC updated.


Stewards out of station: FAMC is collaborating with Housing to work out a proposal for addressing stewards of housing assets who are absent long-term as well as on a proposal to report on a regular basis to the community about housing needs.


Assessment of loan processes: Based on its experience, FAMC felt the need to assess current loan processes. To that end it invited the Loan Group for a meeting. The Loan Group was represented only by Otto and Rathinam, along with Amy as the FAMC representative, while Palani (ABC) and Prabhu (Housing Board) could not attend.

At present, all loan applications under Rs. 5 lakhs are reviewed by the ABC support group (for business loans) and the Housing Board (for housing loans). Otto and Rathinam then evaluate the financial viability of the loans that are brought from either Palani or Prabhu, but they noted that there does not appear to be a consistent and clear vetting process in place. Loan applications over Rs. 5 lakhs are reviewed by FAMC while individual loan applications below Rs. 1 lakh are reviewed by Otto of Auroville Maintenance.

It was noted that a fairer and streamlined system of reviewing all loan requests was required using a standard set of criteria to evaluate all loan applications. The Loan Group agreed to be more diligent in applying accepted criteria in reviewing the loans. For loans over Rs. 5 lakhs, the Loan Group will additionally review the application and make their recommendations to FAMC for final approval. It was noted that to take up this additional work, 1-2 new members may be needed to join the Loan Group.

Follow-up is needed, so it was recommended to form a subgroup of 2 representatives each from ABC, Housing Board, FAMC, and Loan Group to assess and improved existing loan processes and criteria.

Auroville Foundation related issues

Govt. of India (GoI) grants: FAMC in collaboration with the GoI Grant Management Committee and 50th Anniversary Core Team is working out a structure to properly manage the Rs. 10 crores that have been granted by the GoI, specified for capital expenditures only, for this event.

Income Tax assessment: The Auroville Foundation Auditor needs detailed information in a template form from all the units and Trusts, in order to apply to the Income Tax Department for refund of TDS (Tax Deducted at Source). Trusts and units have been individually informed about this requirement.

Miscellaneous issues

Budget Coordination Committee (BCC) mandate changes and feedback: FAMC representatives met with Auroville Council (AVC) to discuss the proposed changes to the mandate and feedback received from the community. AVC will respond to the feedback.

In community,
FAMC (Amy, Bindu, Chali, Chandresh, Lyle, Prabhu, Ulli, Yuval)