Being a responsive and responsible government, it is important to set the record straight on any misconceptions created by detractors of this administration attempting to sell snake oil to people.
In the past few months, this administration has noted allegations on two issues in particular – property rates on agricultural land, and the Lombardy property rates dispute.
These allegations create false expectations and they must be clarified forthwith in deference to our commitment to running an honest government in Tshwane.
As such we proffer the Msimanga administration’s approach to these two issues rooted in the best interests of the people of Tshwane. In so doing, we encourage our people to not fall prey to misinformation deliberately peddled to create confusion and panic by approaching the administration for assistance with any and all service delivery matters, including but not limited to those of agricultural land or property valuation.
False allegations about agricultural property rates
The allegation that owners of agricultural property in Tshwane face an average rates increase of 464% in the new financial year is untrue. This allegation is based on the incorrect assumption that such properties are in fact deemed farm properties or small holdings and used for agricultural purposes and not simply for residential purposes.
In terms of the 2017/18 budget of the City of Tshwane the rates in the Rand on agricultural properties have in fact decreased by 1.62% (refer to the table below for easy reference).
If there is a dispute about property classifications or valuations, this is another matter entirely. To avoid being confused by spurious allegations, it is important to understand how a municipality levies property rates.
A municipality may levy different rates for different categories of property determined according to the use of the property, the permitted use of the property or a combination of both.
The following factors determine the property rates payable by a particular property owner, namely (1) the value of the property (2) the category of the property and (3) the annual rate approved by the Council.
The municipality is compelled to determine the categories of property as contained in the Municipal Property Rates Act if there are such properties within the municipal jurisdiction – including “agricultural”, “residential”, “commercial” and various others.
Property values and classifications are done by an objective process, and then published in a General Valuation Roll. The Municipal Property Rates Act and its regulations govern this process.
In Tshwane each property owner was notified of the valuation and classification of their property by way of a notice as well as on the face of their municipal account. The general valuation roll was also open for inspection at municipal offices.
Aggrieved property owners had until 19 May 2017 to lodge objections against the valuation or classification, and this was also communicated in advance.
Even though the right to lodge a formal objection has passed, property owners who feel that their property was not categorised according to its actual or permitted use can still approach the municipality to have it reviewed.
Why the City is appealing the Lombardy case
The City of Tshwane has been granted leave to appeal the judgment of the Gauteng North High Court in the so-called Lombardy matter.
It is essential that the Supreme Court of Appeal sheds light on the case, especially due to its potential financial implications and its sheer legal complexity.
The dispute is about the payment of municipal rates by owners of vacant land in the former Kungwini municipality.
Kungwini, which includes Bronkhorstspruit and Silver Lakes, was incorporated into Tshwane in 2011.
One of the merger’s many complications was a disjuncture between the respective ratings policies of Kungwini and that of Tshwane.
In Kungwini vacant land was categorised as “residential” for the purposes of levying property rates.
In Tshwane vacant land has its own category, and as a matter of policy the former City government levied unusually high rates on such properties in an attempt to encourage development.
The result was that when Tshwane made its ratings policy applicable to former Kungwini properties in 2012, owners of vacant land had to pay significantly higher property rates.
Tshwane no longer disputes that the passing of the 2012 Supplementary Valuation Roll was legally defective. This was the mechanism which made Tshwane rates applicable to Kungwini properties.
This is the original cause of action vacant land owners had against Tshwane in 2012. They rightly complained that they did not receive proper notice of this new dispensation.
This defect has since been corrected by subsequent valuation rolls, yet the applicants in the Lombardy case insist that all rates levied on vacant land in Kungwini since 2012 remain unlawful.
The DA-led City government remains committed to a fair dispensation of property rates. In the 2017/18 financial year we significantly reduced the rates payable on vacant land (refer to the table below for easy reference).
We are also committed to the financial recovery of Tshwane after years of mismanagement, and so it is our responsibility to ensure that a fair judgment is delivered in the Lombardy matter.
The Msimanga administration is equally committed to ensuring that residents of Tshwane are treated fairly and equitably and that the discharge of services is done in the same manner for all residents and not just for some. That is our commitment and we encourage our people to approach the administration in this regard and not listen to the ramblings of snake oil salesmen hell-bent on sewing confusion and division in our city.