Leopard Creek and municipality settle dispute over unpaid rates
The management at a prestigious golf estate owned by one of South Africa’s richest men, Johann Rupert, is settling a R75 million debt owed to a poor rural municipality in the form of unpaid rates and taxes.
Leopard Creek Golf Estate reached the settlement with Mpumalanga’s Nkomazi Local Municipality in Malalane on Tuesday after a protracted Valuation Appeals Board hearing.
The case has been open since last year.
The municipality valued the property at R1.4 billion in 2012 and expected the golf estate to pay it at least R10 million a year.
But Leopard Creek continued paying it R35 000 a year, in accordance with an agreement it had struck with the erstwhile transitional council in 1996, before the Municipal Property Rates Act was promulgated in 2004.
Details of the settlement agreement remained confidential as lawyers of both parties had not finalised it this week.
However, City Press understands that Leopard Creek Share Block, which owns the golf course and estate, was negotiating to pay 40%, or R30 million, of the debt as a settlement.
A source close to negotiations said the amount was expected to be paid soon and that the company disputed the municipality’s property value estimates.
“They lowered the land value. They said the value was R65 million and would be R550 million after the second phase of the development is finished,” the source said.
“We have a better deal now because tax will be levied on R550 million and, after the second phase is finished, it will be R750 million.”
This means Nkomazi Local Municipality could earn about
R1 million a year from the property.
Cyril Ripinga, spokesperson for the Nkomazi Local Municipality, said: “Lawyers are still drafting the agreement and we will communicate the outcome after that.”
Leopard Creek Share Block’s lawyer, Igno Gouws, said the parties would make a joint statement once negotiations were concluded.
The municipality accused the company of ingratitude after it persuaded communities lodging a land restitution claim in 2008 to exclude the estate because of its potential positive economic impact.
It also obtained an order from the Pretoria High Court in favour of the estate, which is located on the southern border of the Kruger National Park.
The estate has 271 residences, along with recreational facilities and an 18-hole golf course with a club house. Every year, the world’s top golfers converge there to participate in the multimillion-rand Alfred Dunhill Championship.
Nkomazi collects rates and taxes from four urban towns – Malalane, Hectorspruit, Marloth Park and Komatipoort – and 70% of its budget comes from government. Its annual budget is R1.1 billion, which is not enough to provide services to 54 villages, where unemployment is rife.