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IOLProperty - South African Property For Sale
Thursday May 17, 2012

R100m battle over Durban roads

Durban ratepayers could be saddled with another hefty bill of about R100 million because of a last-minute battle over who should pay to upgrade the congested roads around the new Cornubia housing project near Umhlanga.

The row, involving eThekwini municipality, the provincial Department of Transport and Tongaat Hulett Developments, could put a major spanner in the works and delay development of the R20 billion Cornubia project, along with thousands of new construction jobs.

The city's human settlements and infrastructure committee meeting was told yesterday that urgent, top-level intervention was needed to address the impasse between the city and the Department of Transport.

This could include making urgent appeals for intervention to President Jacob Zuma, the National Planning Commission and Human Settlements Minister Tokyo Sexwale if the department failed to honour previous pledges to pay for the upgrading of provincial roads around Cornubia.

Councillors have recommended that a letter be sent to Zuma in which the council would note its concern about the department's "apparent lack of commitment to funding their share of the bulk road infrastructure".

Dave Renwick, project executive from the city's engineering unit, told the committee that the Department of Transport's lack of participation in funding parts of the roads was a challenge.

"We need funding from the Transport Department to assist in funding bulk road infrastructure for Cornubia. We have support from the national Transport Department but we need to get the provincial department on board."

Renwick said the project was expected to create 387 000 construction-jobs and nearly 43 000 permanent jobs.

"On completion the development is expected to contribute R237.6 million a year to the city's rates base and about R1.5 billion a year in taxes," he said.

The Cornubia housing development would be adjacent to the N2 near Umhlanga and Phoenix and Durban's first mixed-use, mixedincome "sustainable integrated development". It is a joint venture between ethekwini municipality and Tongaat Hulett Developments. The development plan aims to incorporate low-income and middle-income housing, schools, businesses, clinics and other public services.

A report before the committee says R5.6bn is to be needed for bulk infrastructure, including water, sanitation, electricity and roads. Costs had been divided among roleplayers, but the main problem area in cost-sharing which had not been resolved was for roads and interchanges considered to be the responsibility of the Transport Department.

These formed part of the existing provincial roads and the cost estimates were in the region of about R606m over a 15-year period.

The most critical of these was the upgrade of the N2 / M41 interchange at Umhlanga, which, subject to funding agreements, was due to start in August.

"This interchange is operating beyond its capacity and, unless it is upgraded, Cornubia cannot be developed," the report reads.

The SA National Roads Agency Limited (Sanral) would foot 50 percent of the bill (R303m) with the Transport Department responsible a further R303m because the M14 was a provincial road.

The report says the Department of Transport had indicated that it would not fund the upgrade because the need for it was due to the increase in local traffic. It argued that the municipality should foot the bill.

"This approach fails to recognise their responsibility to ensure that their roads are safely able to cope with the volume of traffic, and also ignores the strategic significance of their road network in unlocking the huge development potential that will repay the investment many times over," the report reads.

However, provincial transport spokesman Kwanele Ncalane said the department was aware of the matter, but there had not been a thorough discussion with city officials.

He said city officials had met acting transport head Sbu Gumbi yesterday and it was agreed in principle that the other 50 percent would be split between the department, the city and the developers.

This suggests that Durban ratepayers would have to cough up an extra R101m for road upgrades.

"The department is committed but we will not pay 50 percent. A traffic assessment study was done to determine who was responsible for the traffic, so we are saying everyone must contribute. The officials and the department will have another meeting next week to discuss the matter," he said.

ANC councillor Bhekuyise Kikine said: "Given the fact that the provincial road department is not coming to the party, can't the national Transport Department command the provincial Transport Department to come to the party?"

Human settlement committee chairman Nigel Gumede said it was imperative the Cornubia housing project succeeded because the city was sitting on a housing "time bomb". "Currently we are seeing the duplicating of informal settlements through the building of transit camps. We are lucky that we have not seen people marching."

The Mercury

 
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