8 August 2012

Kenya: City Hall Nets Sh600 Million From Land Rate Defaulters

City Hall has netted more than half a billion from land rate defaulters, as the 28-day grace period ends today. This fell short of the targeted Sh3 billion the council had set, as the council's top chiefs weigh over whether to extend the waiver period. The council is owed an excess of Sh10 billion.

City Treasurer, Jimmy Kiamba said yesterday the council was exploring ways of extending the waiver period. Kiamba commended city property owners for taking advantage of the waiver and said the council will strive to improve its services. "We are still consulting on whether we should extend. We call on those who have not paid to pay up today, which is the last day," Kiamba said.

Town Clerk Roba Duba, however, ruled out any extension, saying defaulters will have to face the hammer. "The next stage is now moving into the defaulters properties and repossessing some while we auction the others, our patience has run out," he said. The council's director of legal department, Aduma Owuor, was however confident of instituting legal proceedings to auction the properties.

However, the Karengata Residents Association went to court years ago over rates payment. The residents body has withheld property rates payment seeking orders, which they got, restraining the City Council of Nairobi from enforcing collection of property rates from the residents due to poor services among other issues. The case is ongoing.

Aduma also urged state institutions to take advantage of the last day and pay land rates, which are calculated under the Contribution in Lieu of Rates (CILOR). Land rates chief accountant Peter Muriithi said yesterday that the government, which owes the council Sh1.5 billion should also pay up as their debt do not accrue interest. "Some residents of Karen and Lang'ata associations owe us up to Sh2 billion while those in Runda are yet to pay millions of shillings," Muriithi says.

Muriithi says homes in the upmarket Runda sit on a quarter acre of land and should pay rates of about Sh42,000 annually, but since they default, it accumulates hundreds of thousands.

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