Undeveloped Nairobi plots to attract double rates

Nairobi City County Governor Evans Kidero addressing the press at his office on 2/6/15- [photo by BEVERLYNE MUSILI]

Property owners in Nairobi who have not developed their plots will now pay double the rates to the county government.

This after the High Court upheld the decision by Governor Evans Kidero’s government to peg rates at 34 per cent of the unimproved site value of land, up from 17 per cent that property owners have been paying.

It means if you have an undeveloped plot worth Sh1 million for which you have been paying Sh170,000 annually, you will now be required to fork out Sh340,000 or 28,000 per month. The county government argues it imposed the punitive rates, which also attract a monthly interest of three per cent per month in default, to encourage development of plots.

The applicants – Nairobi Senator Mike Sonko, Karen & Langata District Association and Kaputei Gardens Association – had challenged the doubling of the rates from 17 per cent charged by the defunct Nairobi City Council, arguing a raise of over four per cent required approval of the Cabinet Secretary.

They also argued there was no public participation and that the increment was not justified because the county government has failed to improve services.

However, the Nairobi County Government got the green light to implement the new levies after High Court Judge George Odunga dismissed four cases challenging the rates detailed in the county’s Finance Act, 2013.

Material tabled

In his decision, Judge Odunga said that based on the material tabled before the court, he was unable to find that the decision by Kidero’s government to increase the rates was arbitrary.

The judge said NCC did not violate a court order by enacting the Nairobi County Finance Act, 2013, adding that the government met the constitutional threshold on the issue of public participation in passing the new rates.

Sonko and the other applicants wanted the court to quash the new rates on grounds that there was no public participation in passing the Nairobi County Finance Act 2013.

In a document by County Executive for Finance Gregory Mwakanongo, and seen by The Standard, the adjustments were meant to ensure availability of adequate fiscal resources for the provision of city services.

Yesterday, National Lands Commission Vice Chairperson Abigael Mbagaya defended the new rates, saying counties were allowed by law to increase land rates.

Kenya Alliance of Residents Association CEO Stephen Mutoro described the judgment delivered on September 21 as a “bad ruling”.