City of Joburg hit by billing crisis

The City of Joburg is racking up huge legal costs by failing to address billing issues residents raise before they reach the courts.

It routinely opposes applications, which it then loses with costs and these are paid out of revenue squeezed out of ratepayers.

This cycle results in a further burden of unfair tariff increases that residents have to shoulder, said the Johannesburg Property Owners and Managers Association (JPOMA).

It represents the interests of landlords of 150 000 inner-city households which jointly pay the city R80 million in rates and taxes per month, “yet we cannot rely on the services we pay for and have to resort to costly legal interventions,” says general manager Angela Rivers.

JPOMA has announced another court application, challenging a unilateral City of Joburg decision to bill sewerage services provided to certain blocks of flats at the higher fixed rate specified for “multi-dwellings”, and to backdate this to 2018.

This follows a similar application by JPOMA in relation to charges for refuse removal. Rates charged to educational institutions in Johannesburg saw mayor Dr Mpho Phalatse recently announce an intervention to reduce the impact of a recategorisation and thereby stop a sixfold increase in rates for public institutions and a 10fold increase for independent institutions.

The city did not respond favourably to requests by AfriForum for relief and it and listed education groups ADvTech and Curro proceeded with litigation.

The city opposed the applications so they now intend to proceed, despite the announcement of the mayor’s intervention to limit the increase to five percent.

Last month, the South African Property Owners Association also filed a high court application to interdict the city from implementing its 2021 development contributions policy, which would allow it to use the extra fees it will charge developers to cross-subsidise services in other areas.

Rivers says: “This policy of billing a fixed rate according to property type and size is completely unfair and contradicts the city’s own tariff policy, which stipulates the amount individual users pay for services should be in proportion to their use of that service.

“Instead, the city even bills properties that are unoccupied and using no services.” The tariff determination bylaw makes provision for three different sewerage rates structures for “flats”, “multi-dwellings” and “private dwellings” [houses].

The “multi-dwelling” category is commonly accepted to pertain to complexes with free-standing townhouses, while flats are described in the city’s own bylaws as units within a single multistorey building with a single common entrance.

The fixed rate for multi-dwellings is almost double that for flats, with a house being charged the same as a flat when on an erf up to 300 square metres, and the same as a multi-dwelling when on an erf from 300m2 and 1 000m2.

“We now have a situation where the individual flats in a block that straddles two erven is charged at the same higher fixed rate than applies to a multi-dwelling and a house on a 1 000m2 erf.

“We believe this is nothing more than an opportunistic attempt by the city to fill its coffers by targeting those ratepayers who historically do pay for services.”

Rivers estimates the current matters JPOMA has brought before the court will run up legal bills of R600 000 to R800 000 each. “Each application that we or our members bring is opposed by the city and repeatedly delayed.”

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