End of the road for rate defaulters in Nairobi County

By HAROLD AYODO

Anxiety has gripped property owners in Nairobi as the County Government tightens the noose around necks of land rate defaulters.

Reality started sinking in after Nairobi Governor Evans Kidero recently convinced President Uhuru to direct Treasury to repay more than Sh47 billion owed to City Hall by various State agents.

The anxiety over outstanding land rates came to the fore at a time Nairobi County plans to offer free land to foreign investors seeking to set up businesses. Kidero recently gave an assurance that a land bank will be created and free plots allocated to those interested in building manufacturing plants or other employment-creating ventures.

“We are going to make land available in Nairobi and as a governor, I assure you we will create land banks for investors who come; we will make available land for free,” Dr Kidero said.

The County Government of Nairobi has been chocking under debts accrued over time by parastatals, making it difficult to offer services to residents as required. The parastatals owe City Hall about Sh47 billion.

Home and plot owners in Nairobi who have defaulted on land rates must also pay up before the long arm of the law catches up. There was pandemonium last year when City Hall cracked the whip on rate defaulters in a 28-day operation termed Operation Clamp Down: Jiokoe Sasa as property owners scrambled to pay their rates arrears within the waiver period to avoid the auctioning of their properties.

The campaign sought to encourage payment of land rate arrears by offering waivers on penalties before repossessing and auctioning property.

However, even as Kidero steps up fight on defaulters to improve services, many residents could be unaware that they are debtors.

Registered property owners must pay land rates between January 1 and March 31 annually. Property owners servicing mortgages and banks hold as security their title deeds or lease certificates are also not exempted from paying land rates as the City Hall requires them to provide copies of their registered documents to the chief valuer.

However, they may be exempted if the mortgage agreement expressly states that the lender will be paying rates to City Hall. There are also many people who have bought plots or houses through chamas (merry-go-round groups) or Saccos and have share certificates.

The share certificate holders can avoid their property being auctioned by paying rates as a group on the mother title. Alternatively, the chief valuer can make considerations under instances where survey plans are available or they divide the total debts according to sizes of their property.

The Rating Act empowers local authorities to seek court orders to auction properties at forced sale values. They can also take over the property as either tenants or landlords to collect rent until recovery of outstanding arrears.

The Leadership and Integrity Bill of 2012 may also gives a push to local authorities under provisions that require public officers must pay all forms of taxes.

— The writer is an Advocate of the High Court of Kenya