The South African Property Owners Association (SAPOA) is concerned that the City of Cape Town is not receiving necessary funding for the emergency water supply projects that were launched in mid-2017.
The city proposed to raise the funding through the imposition of a drought charge. According to a statement released by the association, the proposed charge will affect both residential and commercial properties alike. However, the starting point of US $4,050 for commercial properties means that the charge will have a broad impact on the industry as a whole.
Also read: City of Cape Town records US $129.6m loss due to reduced water consumption
Additional concerns
SAPOA further explained that they understand and accept the money implications from the supply augmentation projects. On the other hand, recovering the drought charge uniformly gives no recognition to those consumers who have heeded the call to save water.
According to the association, the calculation of the drought charge is in no way linked to water consumption in a building. Ideally, any imposed charge should be funded by a charge against water consumption. This is instead of charge against the building value.
SAPOA pointed out that the schedule it received from the City of Cape Town stops at US $40.5m for commercial properties. They further raised an issue with the consideration in cases where the property values were above this figure. For buildings approaching US $81m value, this would make the amount of the drought charge unreasonable.
