Head­way in clear­ing back­log

City says it has im­proved the time to process rates clear­ance cer­tifi­cates, writes Anna-Marie Smith

Business Day - Home Front - - HOMEFRONT -

IN HIS an­nounce­ment last week, Cape Town Deputy Mayor and May­oral Com­mit­tee Mem­ber for Fi­nance, Al­der­man Ian Neil­son said: ”We are now close to achiev­ing our tar­get of is­su­ing the cer­tifi­cates within 10 work­ing days.”

Fol­low­ing the mas­sive back­log re­sult­ing in costly de­lays in the trans­fer of prop­erty, came an an­nounce­ment in June this year of the City's new in­te­grated in­for­ma­tion sys­tem, and in co-or­di­na­tion with vend­ing sys­tems of con­veyance at­tor­neys.

The City's new In­te­grated Spa­tial In­for­ma­tion Sys­tem (ISIS) saw im­ple­men­ta­tion in Novem­ber last year, but by Jan­uary this year con­veyancers, deeds of­fice of­fi­cials and prop­erty pro­fes­sion­als claimed an even slower clear­ance process. All rel­e­vant par­ties re­ceived an apol­ogy from the City for de­lays caused by un­fore­seen data and tech­ni­cal prob­lems dur­ing the switch-over to the new sys­tem that arose from both the City and the vend­ing sys­tems used by the at­tor­neys for elec­tronic rates clear­ances.

Im­pact­ing neg­a­tively on the in­dus­try, de­lays re­sulted in fi­nan­cial losses of in­ter­est amount­ing to mil­lions, as well as costly oc­cu­pa­tional rentals. Poor cash flow led to prop­erty agents re­sort­ing to bridging fi­nance at crip­pling in­ter­est rates to meet monthly obli­ga­tions.

In March this year Neil­son said the city was re­ceiv­ing an av­er­age of 299 new ap­pli­ca­tions daily, and that just over 355 000 trans­ac­tions had been pro­cessed since the launch of the new sys­tem. Last week the City re­ferred to av­er­age clear­ance pe­ri­ods in March this year of 19,8 days, while in April this year, this num­ber was re­duced to 12,5 days.

The an­nounce­ment also re­ported that no rates clear­ance cer­tifi­cates had taken longer than 30 days to be is­sued dur­ing April, and that 1 307 cer­tifi­cates were pro­cessed in 30 days or less, de­spite an av­er­age of 200 ap­pli­ca­tions per day. The city says the back­log caused by the sys­tem switch-over has been cleared, with no out­stand­ing ap­pli­ca­tions prior to end of Jan­uary this year, 30 out­stand­ing from Fe­bru­ary and two from March.

How­ever, some in­dus­try pro­fes­sion­als are of a dif­fer­ent opin­ion. Con­veyanc­ing at­tor­neys Smith Ta­bata Buchanan Boyes (STBB), who last year ap­pealed to He­len Zille, the Premier of the Western Cape, to ex­pe­dite a res­o­lu­tion to the prob­lem.

STBB at­tor­ney Me­lanie Coet­zee last week said: “Is­sues at the City of Cape Town’s rates depart­ment have cer­tainly not im­proved in re­cent months. The re­al­ity is clear­ances still take up to 28 days to be is­sued, as con­firmed via an of­fice sur­vey con­ducted re­cently, re­flect­ing av­er­age turn­around pe­ri­ods in the re­gion of 21 days.” Coet­zee said it would also ap­pear that ma­jor is­sues re­lat­ing to in­cor­rect billing amounts had been re­solved, although over­charges to clients in re­spect of ad­vanced col­lec­tions of rates and con­sum­ables still oc­cur.

Com­ment­ing on the city’s an­nounce­ment, Joe van Rooyen, man­ag­ing di­rec­tor of Se­eff Dur­banville and Brackenfell said: “Although an im­prove­ment since the early part of this year partly re­sulted from clear­ing the orig­i­nal back­log, the new sys­tem has un­for­tu­nately not yet pro­duced the de­sired re­sults”.

He said that dif­fer­ent vol­umes in other regions un­der­stand­ably re­sult in faster clear­ance pe­ri­ods, such as seven days in the Over­berg Dis­trict, but that Se­eff Cape Town con­tin­ues to ex­pe­ri­ence av­er­age clear­ance pe­ri­ods of up to three weeks.

An­other Cape Town le­gal firm last week re­ported that although clear­ance times had im­proved to 12 work­ing days by April, av­er­age times of 20 work­ing days were seen early this month, pos­si­bly re­lated to public hol­i­days.

In ad­di­tion were de­lays of up to six months re­sult­ing from certificate amounts not re­flect­ing out­stand­ing electricity costs, such as when electricity ac­counts are payable by tenants and the body cor­po­rate of a sec­tional share prop­erty, as op­posed to prop­erty own­ers.

Re­spond­ing on be­half of the City, Nielsen said: “As far as the is­sue of tenants is con­cerned, the City changed its pol­icy in the past few years. We now re­quire the prop­erty owner to en­ter into con­tracts with the City for ser­vices, and not the ten­ant.

“It is now thus the owner’s re­spon­si­bil­ity to en­sure that ser­vice charges such as electricity are up to date. One key way of do­ing so is to in­stall pre-pay­ment electricity me­ters, so that the ten­ant can­not fall be­hind on pay­ments.”

He says: “How­ever, there are still cases where the ten­ant signed up for the ser­vices be­fore the change in pol­icy that may still cause a prob­lem. Own­ers can ap­proach the City to have the ser­vices ac­count placed in their name.”

Com­ment­ing on sec­tional-ti­tle prop­er­ties, Nielsen said in as­sum­ing prob­lems oc­cur when electricity ser­vice ac­counts re­ceived by body-cor­po­rate en­ti­ties, and where pay­ments are not kept up to date, in­di­vid­ual sec­tion own­ers are un­able to get clear­ance. He said in such cases prop­erty own­ers need to en­sure they elect re­li­able trus­tees who pay their bills on time and col­lect levy debts from de­fault­ing own­ers.

Al­der­man Ian Neil­son, Cape Town deputy mayor and may­oral com­mit­tee mem­ber for fi­nance.

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