FREQUENTLY ASKED QUESTIONS

FAQs

A City Improvement District CID and a Special Rates Area SRA are the same and interchangeable.

A City Improvement District (CID) or commonly known as a Special Rating Area (SRA) refers to a geographically-defined area in which property owners contribute additional rates to fund top-up services for that specific area as per the approved Business Plan.

Typically, these would be services dealing with Urban Management issues like additional public safety measures, cleansing services, maintenance of infrastructure, upgrading of the environment, and social services, etc.

Does the formation of an SRA mean that the City can reduce the level and quality of its services?
No. The City is obligated to sustain existing service levels and to provide basic services as per the Constitution. Each SRA will engage with the various service departments regarding the level of services to be provided by the municipality. This enables the SRA to decide on the ‘top up’ services required.

By pooling their resources in an SRA, individual property owners can enjoy the collective benefits of a well managed area, a shared sense of communal pride, safety and social responsibility, and access to joint initiatives such as waste recycling, energy-efficiency programs, etc. In the end, these all translate into a tangible boost in property values and capital investments.

An SRA is always initiated by a community, and not by the City.

It usually starts with ‘champions’ within a community who feel the necessity to improve the environment within a defined area. They then compile a five-year business plan (including the motivation report, the implementation plan and a budget) indicating how the improvements are to be achieved, and present this to the community at a public meeting. Thereafter property owners are lobbied for their support where a majority (more than 50% in an area classified as commercial and more than 60% for an area classified as residential) has to give written consent to the formation of a SRA.

Once this has been obtained, the steering group has to submit an application to the City. The application is then advertised in the media and property owners are also notified to allow them at least 60 days to render any comments or objections. The City then considers the application with the objections at a full sitting of Council.

After the City has approved the application, a NPC is set up and a board is elected. The NPC has to register for VAT, open a bank account and be registered as a vendor with the City, etc. This must all be in place before the City makes any payment to the SRA.

An SRA is a NPC managed by a board elected by its members, and operated by a management team appointed by the board. Property owners must sign up for NPC membership to allow them to participate in the SRA`s affairs. The City is not involved in their day-to-day operations, but merely exercises financial oversight and legal compliance.

An SRA is governed by the Companies Act (71 of 2008) and manages its own finances and appoints its own auditors. The audited financial statements form part of the City’s consolidated accounts, which are reviewed by the Auditor-General. In addition, monthly financial reports are submitted to the City to monitor and to ensure that expenditure is incurred according to the budget. All SRAs have to submit the Chairman`s report and AFS to the relevant Subcouncil, within two months of their AGM, for noting.

An SRA is funded from the additional rates paid by property owners within the boundary of the SRA. It does not receive any grants or subsidies from the City, but does have the powers to raise additional income.

Yes. Once the City has approved an SRA, the participation of all property owners liable to pay the SRA additional rates, within the boundaries of the SRA, is mandatory. However, there are exceptions in terms of relief.

The following categories of owners/properties will be 100% exempted as per the SRA Policy:

  • Indigent, Senior Citizens and Disables Persons who meet the criteria for rates relief
  • Properties registered in the name of and used primarily as a place of worship
  • Council owned properties used predominantly for official municipal business
  • Other properties who qualify for rates relief/exemption as per the City Rates Policy

No, it is ring-fenced to be ploughed back exclusively into the SRA.

The SRA sets its own budget according to input from its members as per the approved five-year Business Plan. The City does not get involved in this process. Each year, the SRA board has to submit a detailed budget to the City by 31 January. The proposed budget may not deviate materially from the approved business plan. If there is a material deviation, an application in terms of Section 11 of the SRA By-Law is required. The City evaluates the proposed budget for affordability and sustainability.

Defaulters are subject to the City’s credit control and debt collection policies. As such, they can have their water and electricity services suspended or their clearance certificates withheld.

Absolutely! Every property owner within the SRA should apply in writing to the SRA Board for membership of the NPC. Only then are they able to participate in SRA affairs.

Only residents who have applied for membership have voting rights.

Yes, all registered property owners who fall in the Welgemoed CID area can apply for membership.

CID directors do not earn a salary, their position is voluntary.

 The WCID procurement policy, as available on our webpage, sets out how expenditures are approved. Depending on the value of a transaction, approval to commit the WCID to the expenditure is required by an increasing number of directors of WCID. Any conflict of interest  by a director or any involved party will have to declared before any decision is made.  Should a conflict of interest be noted, the party will be excluded in the decision process on the transaction.