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Jul 01, 2008:
The city's mayoral committee (Mayco) has rejected a request from the city's planning department for a year-long freeze on applications to lease council property, due to a backlog in managing its lease portfolio valued at R3,4-million a month.
The shortage of staff has resulted in at least 2 238 of the 5 300 lease contracts having expired but not being renewed, while in many cases rental escalations on existing contracts have not been applied.
Mayco member for Economic and Social Development Simon Grindrod motivated the moratorium on Monday, saying it was in the council's interest to first promote infrastructure-led economic growth.
It took the same number of staff and time to process a small lease as it did for hectares of commercial property, he said.
In a report to Mayco, the city's property management director Ruby Gelderbloem notes that a number of social and legacy projects were put on hold due to resource constraints, some of which affect leasehold rights as a result of the Green Point Stadium and urban park.
Of the 53 projects in this category, involving more than 800 properties, the city is managing only about 17 of these projects with current outsourced capacity.
The city receives about 640 lease applications every year, more than half of which only benefit the abutting owner and have no strategic significance for the council.
Mayco approved expenditure of R3,7-million to employ 16 contract staff to deal with the backlog over the next year.
Gelderbloem wrote that following two attempts to find the skills to deal with high-profile projects that could have political and financial risk, only three of those who tendered met the requirements.
Gelderbloem said this was an indication of the dearth of skilled practitioners available for assistance.
One of the consultants currently involved in nine projects, including ones related to 2010, would soon have to become fully involved in 2010 projects only to meet the strict deadlines.
But not all Mayco members were in favour of a moratorium on all new applications until the council could address the backlog.
Mayco member for environment and planning Marian Nieuwoudt said the ban would only exacerbate the problem.
Mayco member for sport and amenities Shehaam Sims questioned the effect a moratorium would have on legacy projects, while Mayco member for utilities, Clive Justus, expressed concern about the delays such a decision would cause to key water and waste projects.
The city's executive director for economic development, Mansoor Mohamed, said the city would continue to give attention to key legacy projects during such a moratorium.
Mayco member for finance Ian Neilson said the property department could not make recommendations such as those it had made without first consulting councillors.
Mayco rejected the proposed moratorium on new applications. It also rejected a recommendation that, while the council was introducing mitigating measures to get a grip on the backlog, it suspend sub-councils' rights to renew leases valued at less than R200 000 a year.
As a delegation of sub-councils, the approvals process was between six and eight weeks longer than it needed to be, said Gelderbloem, and suggested that in the interim this become the responsibility of the property director.
Neilson said it was important that councillors give input.
The matter would return to the council in August for more extensive political debate.
