Citizen Reporter
Reporter
3 minute read
30 Sep 2020
10:09 am

City of Joburg’s backdated sewer tariff changes to hit sectional title owners hard

Citizen Reporter

The announcement involves changing sewer tariffs by changing the categorisation of complexes, from a block of flats to a 'multi-dwelling' category, which is more expensive. Body corporates will now have to foot massive backdated bills, in an issue that is complicated and difficult to fight.

The crux of the change in categorisation for sectional-title owners right now is that multi-dwelling sewage tariffs are more expensive than sewage provided to a block of flats. Photo for illustration: iStock

The City of Johannesburg has announced a massive change in sewer tariffs to sectional-title body corporates, potentially costing body corporates hundreds of thousands of rands in backdated charges. 

The announcement involves changing sewer tariffs by changing the categorisation of complexes, from a block of flats to a “multi-dwelling” category. 

Those who own sectional-title property are bound to be out of pocket as a host of complicated knock-on effects are felt due to the announcement. 

But this complicated issue is more commonplace than previously thought, Chantelle Gladwin-Wood revealed in an interview with Nompu Siziba on SAfm’s Market Update show with Moneyweb. 

Gladwin-Wood explained that this issue goes back as far as 2017. The crux of the change in categorisation for sectional-title owners right now is that multi-dwelling sewage tariffs are more expensive than sewage provided to blocks of flats. 

Definition changes causing complications 

She said although definitions of a block of flats has changed every year since 2017, a multi-dwelling building is defined as “one building with one communal entrance, which usually only has one sewer outlet – although that’s technically not part of the definition.”

She said there needs to be multiple dwellings on the property as well. As of 1 July last year, an addition was made to the definition to include that multi-dwelling properties must be valued at less than R700,000, which according to Gladwin-Wood, has complicated the issue even further, namely if a valuation was conducted before the decision was made.

“So your same building can actually be a block of flats for the first two years, but not be a block of flats for the last two years,” she explained. 

Who will foot the amended bills? 

Gladwin-Wood said the body corporate would foot the backdated bill in this instance, because it is this account that sewage is billed to. 

She summarised it as “technically there’s nothing wrong with them [City of Joburg] going, oops, we’ve underbilled you, we are correcting that bill now.” 

But the larger the complex or multi-dwelling, the bigger the bill. 

Sewer charges are taxes, which means they have a prescription term of 30 years, she added. “So the charge itself is not necessarily going to be wrong,” she said.

“The biggest problem is where they have wrongly identified the property as falling within the definition of a multi-dwelling, when actually [it] is supposed to be a block of flats… But unfortunately there isn’t an option to fight the backdating. If it is correct that they should indeed be putting you into the multi-dwelling category, because they are allowed to do that.”

How to fight the changes 

The change in categorisation does not work in favour of corporates gearing up to fight the amendments on a technical basis, as this would only work as a temporary solution. 

“They are entitled in law to ultimately change your tariff and to bill you an amount, then fighting it on a technical basis that they haven’t followed the right processes is not going to be all that helpful.” 

In addition, fighting the City of Joburg costs money, and the large bill will likely return, even if fighting it on a technical basis and arguing that due processes were not followed succeeds at first. But this gives the City a chance to follow the correct procedure and smack body corporates with another big bill. 

Municipal-level mistakes 

Gladwin-Wood revealed that municipalities make large billing errors “with alarming frequency”, which affects owners far down the line, who then have no way of recouping that money. 

What frustrates matters even more is that cases involving billing disputes in Gauteng take at least two years to run through the court system, and opposition from the municipality is tangible, Gladwin-Wood explained. 

“… [T]he minute we get a judgment that is helpful for the public, I will make sure that we sing it from the rooftops, and everyone in South Africa knows that they can do something about it.”

This interview first appeared on Moneyweb. To listen to the original interview, click here

(Compiled by Nica Richards)

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