Council faces battle over houses

2009-09-09 00:00

THE 25 tenants in Sanctuary Road have allegedly been offered a total sum of R3 750 000 by the Msunduzi Municipality to vacate their houses in order to make way for the third phase expansion of the Liberty Midlands Mall.

However, the municipality may face a court battle for failing to consult with the Msunduzi Housing Association (MHA).

In 2002, the municipality donated the properties to the MHA. The handing over of the properties meant that council could only gain revenue through the delivery of key services such as water, rates, electricity and refuse collection and the MHA was given full authority to renovate and maintain the properties as rented housing for council.

However, sources say after allegedly receiving an offer of R10 million for the properties from the developer, the municipality went behind the MHA’s back and made written offers to buy off the tenants in order to free up the premises for demolition.

The written offer, which The Witness has in its possession, is dated June 5, 2009 and bears the title and signature of acting deputy municipal manager for development services S’khumbuzo Mpanza.

In the offer, Mpanza states: “We have been in contact with the developer and from our negotiations, the only and final offer to the residents of the Sanctuary Road Housing Scheme is as follows:

• R125 000 lump sum payment to each resident presently occupying a house.

• A further R25 000 will be paid for relocation costs.

• All residents should vacate the properties by no later than July 31, 2009.”

Sources told The Witness they cannot understand how the municipality can be justified in paying compensation to the tenants, most of whom are employed by council and have benefited from cheap accommodation over many years.

“This is in addition to the housing subsidy every municipal employee is entitled to,” said a source.

Further allegations are that the municipality has offered the tenants one year’s free accommodation at Signal Hill. However, the qualifying income for Signal Hill tenants is between R3 500 and R7 500 and sources allege that most Sanctuary Road tenants earn more than R7 500.

Mpanza confirms this in the municipality’s offer to the tenants, saying: “… many of the residents do not qualify for the municipality’s housing scheme as their remuneration has exceeded the minimum criteria”.

In a letter dated August 11, 2009, signed by the municipality’s manager for real estate and valuation Blackie Zwart, the MHA is told that they are expected to co-operate now that the municipality’s negotiation with the developer and tenants has reached the final stages.

The MHA is an independent Section 21 company with its own board of directors so it is hard to understand how the municipality can negotiate on behalf of a separate entity and make its own unilateral arrangements, complained sources.

The MHA has now instructed a law firm to defend its rights regarding the properties in court and the municipality has in turn instructed an advocate to obtain an urgent interdict.

MHA CEO Judy Vather said: “Please be informed that the Msunduzi Housing Association was not consulted over this matter and the municipality took it upon themselves to make the offer to our tenants. I am not able to comment any further on this matter ...”

For his part, Mpanza said:“At this stage this matter has not been finalised and no agreements with the occupants have been signed; therefore we are not in a position to comment further on the matter.”





















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