The Rehoboth Town Council's debt to NamWater has continued to balloon over the past year - from N$17 million in March last year to more than N$26 million a year later.
This is disclosed in documents filed with the High Court in Windhoek in an urgent application through which the Rehoboth Town Council is trying to obtain a court order to compel NamWater to restore the water supply to the town.
The case was due to be heard by Acting Judge Patrick Kauta yesterday morning, but was postponed to this morning to give the town council and NamWater time to negotiate and try to reach a settlement in the matter.
Pending the outcome of the negotiations the town council's application was provisionally withdrawn later yesterday.
The town council was asking the court to order NamWater to immediately restore the water supply to Rehoboth. Alternatively, the town council wanted NamWater to be ordered to supply water to the town pending the resolution of a dispute between them in terms of an agreement which they signed in April last year.
When the current Rehoboth Town Council came into office in December 2010 it inherited a disputed water account of N$15 million with NamWater from its predecessor, Rehoboth Chief Executive Officer Theo Jankowski said in an affidavit filed with the court.
With about 60 per cent of Rehoboth's residents estimated to be unemployed, the town council finds it difficult to collect payment for all of the services it provides to the town's residents, Jankowski stated.
By mid-March last year the town council's unpaid debt to NamWater amounted to about N$17,06 million, and the water parastatal insisted that the town council had to sign an intervention agreement in terms of which NamWater was to start assisting the local authority in the area of billing and revenue collection for the provision of water, according to Jankowski.
Such an agreement was signed in April last year.
Jankowski informed the court that in the town council had run into such severe financial trouble that it was unable to pay NamWater any money at all from August 2010 until March last year.
In terms of the intervention agreement, NamWater agreed to assist the town council in the management of water distribution, water billing and revenue collection at Rehoboth, and also to help the town council install water meters necessary for a proper management of the water distribution system and the billing of end users.
It further agreed to help the town council to separate billing for water from billing for rates and taxes and other municipal services.
The town council also undertook to separate municipal bills for water from bills for other services, and agreed to open a separate bank account into which all money received for water was to be paid.
The town council and NamWater are now accusing each other of having failed to keep their side of the agreement.
Jankowski claimed that NamWater never became the primary driver of water distribution at Rehoboth as had been agreed, but that it only located a cashier at the local authority's office to collect money for a year.
NamWater has in turn accused the town council of having failed to implement a split billing system, and of not ensuring that all of the money paid to the town council for water had been deposited into the separate account opened for that purpose.
In the meantime, the debt to NamWater has continued to grow. By the time that NamWater informed the town council that it was suspending the intervention agreement, the debt had grown to N$26,7 million, the court was informed.
Jankowski told the court that the town council would be able to make arrangements to pay whatever correct amount is outstanding to NamWater, by for example taking bonds over some of its properties and raising bank loans to pay the debt.
Senior counsel Raymond Heathcote, assisted by Geoffrey Dicks and Tania Pearson, are representing the town council.
Sakeus Akweenda, Lot Haifidi and Elias Shikongo represented NamWater in court yesterday.