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Monday Nov 04, 2013

Durban suburbs pay up to boost safety

Property owners, businesses and home owners in Durban are putting their hands deeper into their pockets and paying 'super rates' to improve the safety, cleanliness and investor desirability of their neighbourhoods.

Florida Road, the popular strip of bars, restaurants and clubs, is the most recent area to be granted approval by the city to operate as a Special Rating Area (SRA), after the precinct was deemed to be in 'crisis', and warranting private intervention.

And residents of Botha's Hill now want to implement a similar strategy to improve security in their area.

An SRA is a group of property owners who want to improve their residential or business precinct by employing supplementary services to what their municipality offers, such as additional security guards, street cleaners, landscapers and a project manager to implement planning and development strategies.

'We have to make Durban better. Urban decay has atrophied investor confidence,' said Brian Wright, the project manager of the Florida Road SRA. He also heads up the uMhlanga Urban Improvement Project which consists of two SRAs in the area. There are also plans in place to establish a similar model in Ballito.

Wright said that, like most SRAs, Florida Road businesses had come together because of a 'crisis' in the area.

'[Business] leases were not being renewed, even at the rates they were initiated at five years ago,' said Wright.

This was because of a negative perception of the area, partly about safety.

'If we create desirable precincts and bring people in, it drives property values up. Simply, we make places nice to go to.'
The first SRA Wright was involved with was in uMhlanga. When he came on board in 2007 its annual budget was R800 000.

'Today, it is over R7 million, with 1 500 official members.'
Wright said when allocating a budget for the SRAs, it was simply a case of looking at what the current levels of municipal services were and what was needed in the area, then costing it.

For an SRA to be approved by the municipality, at least 66 percent of residents and 51 percent of business owners in the precinct needed to be in favour of the initiative and, like any democratic process, Wright said there was opposition.

'You will always have those who object. You may have a pensioner who is on a fixed income who cannot afford the increase [in rates], and the big emotive issue is, 'We are paying our taxes, why should we pay more?'. The answer is: If you don't pay more, nothing will change and you will not have a desirable destination for investment.'
Wright said the country's socioeconomically divided past played a part in the need for SRAs, too.

A 'previously advantaged area' could not expect the same level of service it got under the old regime as there were people in dire need of basic services who would take budgetary priority.

In addition to this, Wright said municipal budgets spent on providing basic services to a rural area directly benefited places such as uMhlanga.

Wright gave an example of a shack dweller who did not have running water or a toilet. If the city did not provide ablution facilities to him he would use a river to wash and defecate in. This would get washed down to uMhlanga beach and affect water quality, which would affect the Blue Flag status of the beach.

'If we don't [do this] how will we grow job opportunities? We are competing against Johannesburg and Cape Town and we need to strategically align with the city to get our economic nodes working. Cape Town [property] owners put R40m into its city centre SRA every year,' he said.

The partnership between the SRAs and the municipality extended beyond a simple approval process, Wright added.

'It forms a bond with the city as we work closely with them. When upgrades are planned we provide informed opinion to the city.'
In all the SRAs Wright is involved with, businesses have been the instigators, but now frustrated residents of Botha's Hill want to implement the strategy in their suburbs for safety reasons.

The Botha's Hill Residents' Association wants to address illegal advertising, litter, a lack of services, graffiti, and crime through the SRA. However, not all residents are happy with the plan.

Paul Clarkson said they had police services and most residents had private security companies.

'This is an expensive option; why do we have to pay more for security? Everybody in the street already pays for a security company. Isn't that enough?' he said.

  • What is a Special Rating Area?

    A non-profit corporation is formed by a group of property owners in a particular area who want supplementary services - such as security, street cleaning, landscaping, project management, infrastructure upgrades, planning, and marketing - for their precinct.

    Once a proposal and budget is drawn up, approval is gathered from businesses and residents. For the municipality to approve their application, 66 percent of residents and 51 percent of businesses must agree.

    Once the SRA is approved, property owners are charged additional rates on a pro rata basis according to their property value as a percentage of the SRA's total property value. For example, if your property is worth 1 percent of the SRA's total value, you pay 1 percent of its annual budget in additional rates over one year.

    These additional rates are paid to the municipality, which then pays the money to the non-profit corporation heading up the SRA.

    The directors of the non-profit company are not remunerated, and then pay a project manager and other service providers.

    The Mercury


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