Mall wins rates battle

2013-04-23 00:00

THE owners of the Edendale Mall have won a two-year battle with the Msunduzi Municipality to have the mall’s property valuation reduced.

The executive committee (Exco) last week agreed to write off R1,5 million in outstanding rates that had been based on an incorrect valuation.

An investigation is to be conducted on how the valuations were done and why there was no supporting paperwork.

At issue was an increase in the valuation from R250 million to R312  million within a year. Properties are meant to be valued at least every three years.

In October 2010, shortly after the mall opened, the municipality sent the owners a Section 49 notice stating that the value of the mall had been established at R250 million.

Municipal manager Mxolisi Nkosi said no indication had been given in writing that this valuation was an interim figure.

The property was revalued in 2011 at R312 million.

Mall owner John McCormick said he had not been legally notified about the increase and realised there had been an increase only when he received his rates bill in July 2011.

The next year he received another rates bill on the disputed valuation.

When Exco member Bill Lambert asked how the discrepancy had come about, Nkosi said it seemed the valuation was an estimate.

“Someone stood on the top of the hill and said the mall’s value was R312 million.

“There was no paperwork and no supporting documents.”

Nkosi said his management team had decided to recalculate the valuation from scratch and to document the entire process.

Using various criteria the municipal valuators came up with the original valuation of R250 million.

This amount would be reflected in the next valuation supplementary roll.

Mayor Chris Ndlela said the “speculation” on the value of the mall appeared to have come from a “one-eyed man”.

Lambert asked whether the so- called one-eyed man had been reprimanded. Ndlela replied, “Unfortunately, I am told he is nowhere to be found.”

Exco member Jabu Ngubo said the matter warranted a thorough investigation because one would want to know what criteria were used to arrive at the final valuation.

She said this could mean that there were other properties in the city that could be over- or undervalued.

The mayor said the management team had a list of names of people who would be questioned during the investigation of the mall valuation.

He added that such outcomes were likely when junior officials made decisions without proper consultation with their seniors.

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