GEORGE NEWS - George ratepayers have received their July statements and will know by now by what percentage their property rates have gone up after the George Council approved the revised valuation roll earlier this year.
The George Ratepayers Association (GRPA) intends to challenge the municipality's multiple announcements this year that property rates will increase by an average of only 16,6%.
In a statement issued on Monday 31 July, the association invites ratepayers to submit their individual information regarding property rates for June 2023 (old) vs July 2023 (new) by 7 August.
It is gathering this data from ratepayers to use together with data from the George Municipality's (GM) valuation roll to take the George Council on review in this matter.
According to Jacques Wessels, a GRPA committee member, the information will be tabled to the municipality to strengthen their request to review the valuations.
"If the municipality is still unresponsive to our plea, as they have been to date, we will approach provincial and national authorities."
The association says not only are many of the valuations based on inflated property values, but there are also large discrepancies in the allocated values of properties, with some homeowners' rates decreasing.
The municipality's published figure of a 16,6% increase might be accurate "on average", but in real terms some residential property owners are facing increases in excess of 40% and even up to 300%. Business and commercial property rates are up by as much as 20% while industrial property owners are having to cough up for an increase of around 90%.
The GRPA's figures are based on individual responses from members of the public and an analysis of the total valuation roll. Its efforts to obtain information regarding the valuation process have been in vain so far.
George Herald earlier this year reported on the municipality's stance that the valuations were based on the most recent property sales prices and that property prices have increased substantially because of a high demand market resulting from an influx of new residents.
But the GRPA maintains that there was an apparent lack in competency in the compilation of the values and of official and political oversight.
Discrepancies
The GRPA points out large inconsistencies in values being allocated to similar properties within suburbs and streets with one neighbour receiving a slight reduction in rate charges while the next faces a large increase.
A few examples are:
• In Denneoord, one property owner is facing an increase of 92% in his property rates, while his neighbour's rates have gone down by 1%.
• In Wilderness East, four vacant erven's rates have increased by between 116% and 218%, while 11 vacant erven in the same area's rates are down by between 2% and 58%.
• In Wilderness, in one street, seven owners face rates increases of between 120% and 238%, while one owner's rates have increased by "only" 43%.
• In Fernridge, some owners' rates have increased by between 30% and 56%, whereas other similar properties have seen rate reductions of between 8% and 18%.
The association says, "It appears to the GRPA, from this data, that the properties that changed hands in the past few years were valued at their sale price, whereas other properties were valued using a completely different method, resulting in huge discrepancies."
The municipality has to date refused to respond to their request to disclose the "Fair Market Value" calculation method used in the new valuation roll.
Few objections granted
"Council maintains that individual property owners had the opportunity to object to the values, but GRPA has information that only a few objections were granted and then with minimal reduction in values," reads the statement.
"The appeal form is also so complex and limited towards one component of the rates calculation (market value), that there is simply no way property owners can use it to any effect to correct such vast discrepancies."
The association airs concern for longtime residents, especially those on low and fixed incomes who cannot afford such exorbitant increases in municipal costs.
Ratepayers who would like to contact the GRPA regarding their July property rates, may send a WhatsApp to 082 445 1535.
Read the GRPA's full statement at www.georgeherald.com. There is also a link to the form that can be completed to submit your rates information to the GRPA.
Ratepayers taking on George Muni re property rates
The George Rate Payers Association (GRPA) is currently gathering data from members and the public alike (see accompanying article to find out more about the GRPA).
The GRPA is using this data, together with data obtained from the valuation rolls, to challenge the George Municipality (GM) announcements, as first published on 5 April 2023, that property rates will only increase by an average of 16.6% in July.
Whilst this might be true ‘on average’, the reality hidden inside the data is much much worse for large portion of George’s property owners, this affects all property owners across the board, at all levels of property values.
The reality is that some residential property owners, who constitute the backbone of municipal revenue, will face increases in excess of 40 % on their municipal property rates, with some even facing increases of 200 - 300%, following the acceptance by council of the revised valuation roll. Business and commercial property owners have been ‘spared’, with increases of ‘merely’ 20%.
However, industrial property owners will also face hefty increases of around 90% on their property rates, based on the new inflated valuations of their properties.
National legislation as contained in the Municipal Property Rates Act clearly indicates that the determination of property values and tariffs must be equitable, fair and in compliance with the South African Constitution.
These proclaimed tariffs and values clearly fall far short of the laws contained in the Act and the Constitution. This statement is based on individual responses from members and an analysis of the total roll which reflects an apparent lack in the competency in the compilation of the values and the official / political oversight therEof.
This is reflected for one in the large inconsistencies of values being allocated too similar properties within suburbs & streets with one neighbour receiving a slight reduction in rate charges while the next will face a large increases;
To name just a few examples of this vast problem:
• In Denneoord, one property owner is facing an increase of 92% in his property rates, whilst his neighbour’s rates have gone down by 1%.
• In Wilderness East, 4 vacant erf rates have increased by between 116% and 218%, whilst 11 vacant erven in the same area’s rates have reduced by between 2% and 58%.
• Still in Wilderness, in one street, 7 owners face rates increases of between 120% and 238%, whilst 1 owner’s rates have increased by ‘only’ 43%.
• In Fernridge, some owners’ rates have increased by between 30% and 56%, whereas other, similar properties have seen rate reductions of between 8% and 18%.
• etc.
These scenarios are not unique to a few properties. It appears to the GRPA, from this data, that the properties that changed hands in the past few years were valued at their ‘sale’ price, whereas other properties were valued using a completely different method, resulting in the huge discrepancies mentioned above!
The GRPA is calling into question the valuation methods used in the new valuation roll. Yet, the municipality is so far refusing to respond to GRPA request to disclose the Fair Market Value calculation method used.
Council maintains that individual property owners had the opportunity to object against values, but GRPA has information that only a few objections were granted and then with minimal reduction in values. The appeal form is also so complex and limited towards one component of the rates calculation (‘market value’), that there is simply no way property owners can use it to any effect to correct such vast discrepancies.
GRPA implore all property owners to link with GRPA (links below) and to submit their individual information re property rates for June 2023 (old) vs July 2023 (new) by August 7th, to enable GRPA to take the George Council on review regarding the new valuation roll and property tariffs.
Council's explanation
The increases in property values and resultant rates being levied, especially residential, are explained by council as based on the exponential growth of George with the resulting shortage in properties. This statement is incorrect as the growth in George is certainly not exponential and at best +-2% per annum as reflected in population growth estimates.
In addition, this “growth” in newly rateable (and more expensive) properties, along with renovated revalued properties, has in any event already been adding substantially to the revenue base of the municipality (and to their impression that rates are only increasing by 12 – 15%).
This additional revenue base should offset property rate increases for longer term residents, whose property values have certainly not all increased by 100% over the past 5 years, as the municipality claims.
Council did adjust the associated residential property tariff down by 28,88% from R0.008219 to R0.005846, and increased the base deductible from R150,000 to R230,000.
However, they neglected to inform citizens that these decreases are vastly obscured by the increases in property values of between 40% to 400%, resulting in an average property rates increase of +-40%, with the data already showing increases of up to 230% or more in some cases.
In addition, property owners will face well above inflation increases in all other municipal service tariffs. This is contrary to the undertaking embedded in the current coalition agreement between the DA, FF PLUS & ACDP, to consider its citizens by limiting annual increases to the rate of inflation.
This means that we as citizens should seriously be calling into question the valuation methods used in the new valuation roll. Yet, the municipality is so far refusing to respond to GRPA members’ request to disclose the Fair Market Value calculation method used.
The GRPA are concerned for our longtime residents, and especially persons on low and fixed incomes who simply cannot afford these exorbitant increases in municipal costs.
The higher cost of ownership is also likely to deter businesses from growing or establishing themselves in George, thus leading to higher unemployment and associated social ills, with more people joining the indigent grant lists.
Furthermore, there is already an excessively high number of defaulting debtors on the municipality’s books, and these tariff increases will simply exacerbate this problem.
Expecting some rate payers to take up the slack is also not a sustainable strategy. The problem with such exceptionally high increases in property rates (and similarly with the new ‘base tariffs’ for electricity and water usage), is that the municipality is introducing a very high, fixed long term base cost to solve a short term, variable revenue problem (the decline in electricity sales due to load-shedding).
Even if subsequent increases remain in line with inflation, some property owners are facing a 500% increase in their property rates over the course of the next 5 years! These economic productive persons can and will ‘vote’ with their feet and move away from George, to the detriment of not only the council’s budget, but also of every one of the long term residents of George who have invested their lives and savings in this city.
GRPA has approached council many times with these issues over the past few months, but so far our appeals have fallen on deaf ears. This challenge will not be so easy to ignore.
The form can be completed at the following link: Residents Property Rates Info or via the GRPA Briefing whatsapp group: Visit https://chat.whatsapp.com/DrII1fh7PYJGQRXYJ2Ori8 to be added to the Briefing group.
All the required data will be in your municipal accounts for June and July 2023.
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