16 March – SRA Questions, Answers, Comments and Responses

Question: Can the legitimacy of the voting process will be challenged and if challenged and how will those who are not members of the Residents Association be informed?

Answer: People incorrectly see the voting as an election process. Nobody is being elected. The Kouga Municipality simply requires, as per the SRA legislation, proof of consent of the majority of property owners, 50%+1, that they approve of the SRA levy, and as such allow the Municipality to add it to their monthly Municipal bill. The consent forms are required in hardcopy format and can be inspected by anyone who chooses to do so. It cannot be a secret ballot. We have used the term vote on the consent form to avoid confusion as to a yes or no to the consent requested by us.

Question: Before I can vote on supporting the special levy I would like to know how the amount was decided?

Answer: The levy was calculated based on detailed cost estimates we have collected over the past year for each piece of our infrastructure that  we need to restore. The road costs came from the work a group of  consulting engineers we hired – EAS PE. These costs are based on a survey completed by them. The sewerage costs were given to us by  Aurecon, who have the complete set of drawings for the roll out of water borne sewerage to the remaining 75% of properties who are on conservancy tanks and soak aways. The River, Spit and Beach costs have  been based on the work done by Worley Parson in 2014, and subsequent  work by the Riparians, and our own team. The security camera estimates were extracted from information provided by two separate Security  camera equipment companies that service a lot of private estates and cities around South Africa.

Question: What if the municipal rates spiral?

Answer: The Municipality cannot increase its rates over and above inflation without a specific application to National Treasury (this is specifically to protect property owners from being exploited). The Municipality relies on an annual inflation adjustment and the re-valuing of properties every 5 years

Question: Will there be written agreement between the SRA and Local Authority as to who does what, in the absence of such, efforts will naturally default to the SRA doing everything (the slippery slope).

A: This is spelt out in the SRA Business Plan. In our draft Business Plan it is very clear that we are not a surrogate municipality.

Question: The issue of ownership of infrastructure; If the SFPO is building and maintaining infrastructure should it not be the owner of, or at least have lien over same?

A: If we wanted to turn the whole of St Francis into a private estate then we should take ownership of the land and infrastructure, including Sea Vista. This also means all infrastructure including electricity, water, refuse removal, etc. We do not have a mandate from the property owners to do this as this would require a lot more money than we can raise through this levy. We want the Municipality to get back on its feet and serve us going forward, but it simply does not have the resources to do so in an acceptable timeframe, which is why we are proposing the SRA levy.

Question: Has anyone tried to analyize why properties in St Francis Bay have dropped more than 30% in the past 8 years. Second to Plett it is one of our premier coastal holiday destinations. We can’t blame potholes in the roads or the beach erosion for this.

Answer: This has been caused by the declining state of our infrastructure, both environmental and roads etc. Many people have considered selling up and getting out of St Francis because of the state of our infrastructure, and the absolute resistance to change by some of our retired community. The possibility of the SRA solution has held back a lot of these disenchanted property investors, but it leaves us with a depressed market

Question: How much revenue is collected each year from the current rates, and how are these funds allocated? Sewerage, water and electricity are charged separately and homeowners are charged for these services whether their homes are occupied or not, or whether plots are developed or not. I expect the new DA mayor to provide the reasons why there is no money available for repair of infrastructure.

I am all in favour of repairing and improving the beach facilities and would be willing to make a monthly contribution but feel 50% of current rates to be unaffordable.

Answer: The Municipality were asked to give a full set of figures for St Francis and private estates in early December but they said they could not do so until January. We couldn’t request this information until the DA Councillors had agreed to support our SRA proposal, and were only given this decision late November. Our research has told us that St Francis Bay’s 2,150 properties (which excludes the private estates, Cape St Francis, and Sea Vista township) contribute about R37m a year in rates. The private estates probably add another R15m, bearing in mind that some the River Estates pay Agricultural rates (25% of the residential rates). So we think about R50m pa is paid by St Francis excluding Cape St Francis and Sea Vista.

We are not privy as to how these rates are allocated by the Municipality but would think they first of all are used to pay salaries and overheads (buildings, equipment, etc.). What we were told by Ben Rheeder and Elza van Lingen at the AGM was that they are obligated to spend 60% of all available funds to underprivileged areas. The Municipality has budgeted to collect R680m from all of its services in the 2016/2017 year. The capital budget is R60m, which is hopelessly inadequate for what is required to be done. Our Waste Treatment plant alone requires R10m to upgrade it because it is running at full capacity or more.

Water and electricity is charged based on consumption. You can look at your own account to see whether an availability fee is also charged. Sewerage is a levy of somewhere around R189 per month, which is consistent with a water borne sewerage service. We are not charged for the honey sucker to empty our conservancy tank in St Francis Bay. Cape St Francis (CSF) on the other hand has no water borne sewerage at all and have to pay between R650 and R960 per honey sucker service. If you require two services a month (as I do for my conservancy tank), then you will pay R1,300 – R1,920 per month. The average property value in St Francis is R3m with monthly rates of R1,650 and The sewerage service in CSF will cost you between 80 – 110% of you monthly rates!  Our honey sucker services appear to be heavily subsidised in St Francis Bay.

You have every right to ask the DA whatever you choose. Unlike the ANC previously you will get an answer.  From my point of view the DA are working very hard to turn around a severely damaged Municipality. The Municipality has a lawsuit currently in progress for R750m for their part in failing to deal with the fires a few years ago. Their vehicle fleet of some 220 vehicles had less than 10% left on the road when the DA took over in August. PE Metro are claiming an underpayment of R43m on the water account as PE supplies Kouga Municipality with its water. There are a number of corruption charges they are dealing with to clean up the Municipality. They have to reinvigorate their staff….among many other challenges.

 We are proposing 50% to fix the infrastructure backbone of our town. We have had professional engineers estimate the R373m to do this. 36% of this total value is fixing the results of man-made interventions in our environment. Santareme was built on the sand dunes that fed sand onto our beach, and has caused the loss of our beach. The diverting of the Sand river from where it entered the sea near Aldabara to the Kromme river, has resulting in depositing all its sand in the river rather than on the beach where it fed the Spit.

As regards the cost of restoring our infrastructure, we can extend the period beyond 10 years and pay less, but the cost of fixing all of this is just going to climb the longer we leave it. The 50% levy will adjust our rates to 0.92, still below PE’s rates of 0.97, but we control through the SFPO NPC (Not For Profit Company) all of this additional levy (with the exception of a small administrative fee deducted by the Municipality). We know that we are stuck between a rock and hard place, but for the 10 years
that I have been living full-time in St Francis I have not seen or heard of any solutions to our problems. The last serious proposal (beach, spit and river only) was in 2006, and that was rejected. Look where that got us.

Where this levy is unaffordable we are in the process of setting up a system whereby people can apply for partial or full relief.