25 September 2008

By Keotshepile wa Mogotsi

THE City has set about educating people about its new rates policy with a road show, kicking off with a meeting at Boipelo Primary School.

Here the valuation manager, Pelekelo Mwiya, explained the Municipal Property Rates Act, a national law that regulates the power of municipalities to value and rate immovable properties - land and buildings.

Residents learned about concepts such as market value, or the amount a property realises if it sold on the open market on the date of valuation; date of valuation, or the date on which the market value of a property is assessed; and date of implementation, or the date on which the municipality will implement its valuation roll. In Mogale City, the date of valuation is 1 August 2008.

Myiya said the date of implementation in Mogale City is 1 July 2009. A specific formula is used to calculate the rates. “The amount payable is calculated by multiplying the market value of the property by a cent amount in the rand that a municipal council determines. And, the tariff is determined by the municipality in terms of its tariff policy,” explained Mwiya.

Property rates differ according to the valuation of the properties. This means that there are differential ratings and municipalities may levy different tariffs for different categories of rateable property.

These categories must be determined in the rates policy and may include residential properties, industrial properties, business and commercial properties, agricultural properties, public service infrastructure and state-owned properties.

In a packed meeting at Kagiso Hall, valuation specialist, Paul Els, spoke about crucial valuation information that the public should know about. He reiterated what Mwiya had talked about and emphasized that rates were not paid on some properties.

“Municipalities may not levy rates on some properties,” Els said.

“The first R15 000 of the market value of a residential property is excluded from the rateable value. The first 30 percent of the market value of public service infrastructure is also impermissible” he said.

Given some confusion from the floor, presenters were at pains to explain that the City’s property rates policy that was going to be implemented in 2009, was guided by the Municipal Property Rates Act of 2004, a national law that regulates the power of municipalities to value and rate immovable properties.

Rates on newly incorporated property must be phased in over three financial years - 75 percent discount in the first year, 50 percent discount in the second year and 25 percent discount in the third year.

In addition, properties that have never previously been included in the valuation roll, including properties used for agricultural purposes, will now pay property rates.

Agricultural property owners may expect some relief in the form of a rebate. Data collection and preparation of Mogale City’s Valuation Roll will be done with accordance with the policy.

Each municipality must prepare a valuation roll of all properties within their jurisdiction. Municipal valuers must be appointed to determine the market value of all immovable properties. Professional valuers will ensure that properties are valued fairly and objectively.

These professionals must be registered as valuers in terms of the Property Valuers Profession Act. Data collectors employed by the municipal valuer must carry identity cards, and may only visit properties between 7am and 5pm, Mondays to Saturdays.

The road show visited Munsieville, Kagiso, and Swanieville; visits to the rural areas of Muldersdrift and Ga-Mohale and to the council chamber have been postponed.

Rates policy open for comment

State passes property rates bill

City stakeholders discuss budgetary planning processes