Relief as Joburg to recalculate schools’ rate

As the City of Joburg backs down on extreme property and tariff rates charged to education institutions, private and public schools will now see bills recalculated to a standard five percent increase across the board.

With 741 private schools and 921 public schools affected by the national department of cooperative governance and traditional affairs (Cogta) rates and tariffs changes as the new financial year saw the amended Municipal Property Rates Act (MPRA) come into effect.

Curro Holdings was one of the affected parties and the group’s spokesperson, Mari Lategan, said they had noted the media statement issued by the City of Joburg surrounding the disputed municipal rates matter for educational institutions.

“Curro’s legal team has taken the notice under review and will engage with the City of Joburg accordingly,” she said.

In the 2021-22 financial year, several preschools, schools and other educational institutions, both public and private, were categorised by the city’s rates policy and in line with the then Section 8(2) categorisation as “education”.

The new law revealed a writeoff of education classification which applied to schools and charged them as public benefit organisations and reclassified them as businesses.

The city was taken to court in relation to current and previous years’ property rates charged to the 19 schools. Relief as Joburg to recalculate schools’ rates Joburg mayor Mpho Phalatse said the city had been overwhelmed by queries, complaints and lawsuits against them after the implementation of rate hikes last month which pushed them to find a solution.

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According to Phalatse, the solution was created with a backdrop that once a municipal budget was adopted, the municipality and its residents were bound by law to adhere to what was adopted.

“The City of Joburg has been contending with the results of a decision taken by Cogta to amend the property categories in Section 8(2) of MPRA,” she said.

“The mayoral committee and city, particularly the MMCs for finance and the revenue department, as well as the department of legal and contracts, have been working around the clock to find a workable solution.”

While external parties such as Curro and AfriForum sought court action against the city, Phalatse said the city’s legal and contracts department requested a meeting with the parties who brought action against the city to put a proposal to consider.

The Solidarity School support centre’s head of department Melanie Buys said they welcomed Phalatse’s commitment to resolve the issue and hoped to see schools and other institutions of learning subjected to a separate category on a permanent basis.

“According to the new category, a public school is now subject to a ratio of 1:1.5 compared to 1:0.25 last year, which increases the school’s monthly rate from about R12 073 to R75 952 per month,” she said.

“This ratio represents a percentage of the amount for which the school was valued. The bigger the school building, the more the management will have to pay for property taxes.”

Phalatse added the city has also written to the applicants to settle out of court.