Metro stalls on leases

2013-08-23 00:00

ABOUT 25 tenants at the Virginia Airport are set to take eThekwini Metro manager S’bu Sithole to court after the metro decided not to sign a 10-year lease with the tenants. A group of individual businessman sell or repair aircraft, provide flying instruction, charter aircraft and provide refuelling services, among other things, from these premises.

Spokesperson for the group, Daryl Mann, said they have been struggling for more than a year to get a long-term lease from the municipality, and that funding to the tune of R50 million from the Treasury has been lost due to the non-availability of the lease. In a week’s time Mann will give instructions to attorneys representing the group to proceed with legal action.

He said while they were not getting the funding, other smaller airports throughout the province were “taken care” of.

“On February 8 this year we, together with our legal representative, had a meeting with the municipality where the manager promised to give us a five-year lease, which stood to be renewed for another five years.

“After that meeting I spent about R400 000 repairing one of my hangars, which I wouldn’t have done had it not been for the lease promise,” said Mann.

He said due to the uncertainty, employees were starting to look elsewhere for jobs.

Metro manager S’bu Sithole stood his ground, saying that as an accounting officer he could not be forced by courts to commit to undertakings that would not serve the best interest of the metro and its people. “My role as an accounting officer is to look at the needs of the municipality and the community. I’m to see to it that all the assets are utilised productively. Our source of income has not been growing to meet our needs and to make that happen we need to undertake projects that will be productive,” he said.

He denied promising a five-year lease to the operators during the February meeting, but that a month-to-month lease was offered.

“This lease period is enough for us to finalise our consultation and research with other stakeholders. Once that is concluded, then we will consult them [operators] to say ‘this is what we came up with in terms of developing the airport’. We will never leave them out in the cold.”

eThekwini official opposition (DA) caucus leader Zwakele Mncwango said during a visit at the airport yesterday, it was established that provincial Treasury has not made funding available for the airport because of the lack of leases for operators.

“Instead, the critical funding of up to R50 million has been diverted to other airports in Margate, Ulundi and Richards Bay. This is a huge loss to Virginia Airport,” said Mncwango in a statement.

He said the municipal manager had “stubbornly” refused to honour a council resolution of October 2011 where it was agreed that leases with the airport operators should be finalised. “This had led to a situation where much-needed funds are lost to other airports,” he said, adding that they support the legal route sought by the tenants to resolve the matter.

Clive Coetzee, general manager: infrastructure management and economic services in the Treasury, said it was “absolute nonsense” that Treasury had diverted funding meant for Virginia Airport.

“In April 2012 I received a funding request of R25 million from the metro’s economic development unit, which at this stage has not even been considered. We cannot consider funding that airport while there’s uncertainty about its future,” said Coetzee.

“My role as an accounting officer is to look at the needs of the municipality and the community. I’m to see to it that all the assets are utilised productively.”

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