The battle lines have been drawn with the City of Cape Town pitted against ratepayer and home owners organisations over its tariffs and budget structures.

This week the Cape Town Community Ratepayers Association (CTCRA),  announced that it has submitted an application to join the high court case brought by the South African Property Owners Association (SAPOA) against the City of Cape Town (CoCT) over its proposed tariff structures.

The City is currently facing legal action from SAPOA regarding the it’s 2025/26 budget and its proposed tariff structures, specifically the city-wide cleaning levy. 

SAPOA argues the levy is unlawful and unconstitutional, while the City maintains it is necessary to fund infrastructure development.

On Thursday the CTCRA announced that it has applied to participate as Amicus Curiae a “friend of the court.” 

In its affidavit, the CTCRA said it supports the arguments put forward by SAPOA and highlighted the financial strain the City’s current billing system places on households.

The City’s practice of linking fixed water and sewage charges to property values, along with a city-wide cleaning levy, has “a disproportionate impact on the disposable income of the middle class,” the association argued.

Chairperson of the CTCRA, Bas Zuidberg, expanded on the submission, explaining: “We support the arguments made by SAPOA. Furthermore, we have highlighted the adverse effect that the linking of fixed water and sewage charges to property values, as well as the separate city-wide cleaning charge, have on the disposable income of the middle class. 

“We point out that contrary to commercial ratepayers, residential ratepayers have no options to offset their increased rates bill through increased rent, product and/or service pricing. The effect on residential ratepayers is therefore possibly more onerous than on commercial ratepayers.

“Finally, we have shown that CoCT should be able to levy similar amounts through alternative mechanisms that do not rely on property values.”

Zuidberg expressed concern about how the case is being framed in CoCT’s answering affidavit. 

“Contrary to what has been implied, CoCT will still have the chance to levy increased charges to ratepayers to balance the budget. Of course, CTCRA would encourage CoCT to reduce the budget through efficiency measures or the rapid introduction of additional revenue streams, before charging ratepayers.”

He went on to stress: “Neither is it correct that the owners of properties at the lower end of valuations will be ‘hit hard’. CoCT has at its disposal lawful methods to alleviate excessive pressures on these owners.”

 “Finally, the portrayal that this court case is being brought by ‘rich commercial players’ against a city that is trying to enact a ‘pro poor’ budget does not do justice to the thousands of residents who objected to both versions of the budget.”

Sandra Dickson, from STOP COCT, a non-political activist group focused on keeping the City of Cape Town Council accountable, also welcomed the legal challenge and is hoping for a positive outcome for ratepayers.

“For years the City of Cape Town has been pushing the perimeters of Municipal Laws to maximise their revenue via any means possible. It started during the drought where a temporary drought levy were to be introduced. After substantial public outcry, this levy was replaced with the permanent pipe levy. None of these were ever tested in a court,” she said.

“The introduction of the new sanitation and ‘Cleaning Charge’ followed as a result. It is therefore welcomed that at long last, SAPOA is challenging the City over these fixed charges and link to Property values.

“If SAPOA is successful, residents will have the opportunity to again participate to object to any attempt by the City to repeat these questionable practices to rake in revenue for their ambitious expansion plans which often is not put out for proper public participation,” Dickson added.

In the City’s answering affidavit Mayor Geordin Hill-Lewis explained that “in substance this application questions the role of the City in the determination of a budget at all and whether the City, or any other municipality, can indeed forge ahead on any new or innovative path to ensure not only better service delivery for all now, but also in the future”.

The City said they are aware of the relentless increases residents face in administered costs, electricity costs, municipal bills, food, fuel and household necessities, but that this has been “taken into account by the City at each step of the budget process”.

The mayor explained that they received 15,210 comments through both the March and May public participation processes related to the tariffs.

Hill-Lewis, in his affidavit, said that the City did not lightly decide to impose the three fixed tariffs which are the centre of SAPOA’s litigation.

“Neither does the City have ready alternatives simply there for the plucking, to replace the budgetary shortfall that will ensue should they be set aside. This shortfall will be an amount of R4,233,768,467 if all three fixed tariffs are set aside.”

He also explained that property value bands differ from the “cent amount in the Rand” (being the basis of calculating property rates) as contemplated in the Rates Act.

The court battle, set down for 18 and 19 September, is expected to highlight significant impacts for both commercial and residential ratepayers in Cape Town.

tracy-lynn.ruiters@inl.co.za

Weekend Argus 

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