Finance
Finance Department
The primary mandate of the Finance Department, in accordance with the Rating Act, 1995 and the Financial Regulations of 1969, is to manage the financial business of Council. The Finance Director, who is the Head of the Department, is required to ensure that departmental procedures and processes are documented and used appropriately for proper functioning of Council. The department forms the backbone for the effective functioning of Council in the sense that without financial resources, Council would not be able to execute her operational requirements and it would be difficult to achieve the city’s vision and mission. One of the key objectives of the department is to ensure the integrity, prudence and authenticity of Council’s financial system and transactions as well as their appropriate recording to improve the liquidity levels. This is done to enhance the functionality of the organization and to facilitate completion of a substantial number of capital projects and service delivery deliverables.
Sections Under The Department
The department comprises of the following sections;
- Revenue section – the main objective of this section is billing and collection of rates and user fees from the urban local government’s various sources of income
- Creditors section – the main objective of this section is to pay creditors timeously and accurately
- Stores Section – the main objective of the Stores section is receipt of incoming goods, inspection of all receipts, storage and preservation, identification of all materials stored, materials handling, packaging, issue and despatch, maintenance of stock records, stores accounting, inventory control, stock-taking and adherence to Council’s procurement procedure
- Cashbook – the main objective of this section is to record all cash and bank transactions systematically into Council’s main cash book. It is in this section that all records of bank deposits, bank withdrawals, receipts and payments through cheques and Electronic Funds Transfers (EFTs) are safe guarded and maintained on a daily and monthly basis
- Loans and investments – the main objective of this section is to pay Council’s outstanding loans with the various financial institutions on time and in a professional and accurate manner. The section also advises on any changes that may arise. In this section an investment account is maintained for purposes of accounting for interest received through investment in financial instruments such as call accounts
- Fixed assets – the main objective of this section is to maintain a proper and accurate fixed assets register of all Council assets, both tangible and intangible, on a monthly basis and conduct a quarterly and annual inventory
Property Taxes (Rates)
The legislation that governs the rating of properties is the Rating Act of 1995. The law states in Section 6 (1) (a) that each rate shall be made, levied and assessed on immovable property on the basis of the valuation of the land and improvements thereon. Council, therefore, levies property tax on all immovable property that exists within the urban boundary; whether the property/plot is developed or undeveloped. The property includes all tangible real estate property, houses, office buildings as well as the land. The tax is commonly referred to as rates and it is billed on an annual basis. Rates or property tax is the annual amount paid by a property owner to the local government. It is through these taxes that Council is able to deliver service to the city. The service provision includes road maintenance and construction, street cleaning, refuse collection, overgrowth clearing, city lighting during night time, traffic lights functionality, abatement of nuisances and other services required by residents and all other stakeholders.
Property Valuation
The value of a given property fluctuates over time, depending on the value of surrounding properties or improvements to the property. Council is, therefore, mandated by legislation to carry out a valuation exercise of all properties available in the city every five (5) years. This valuation exercise is referred to as a General Valuation. This is done to determine the latest value of all properties in the city. It also makes it possible for Council to bill property taxes to property owners. The legislation states that the basis of the valuation of property shall be the market value of such land and any improvements thereon. On an annual basis, a supplementary valuation is carried out. This covers new structures and townships (if any) as well as alterations to existing property. The Rating Act, 1995, calls for Council to engage (through open tender) an independent property valuer who is approved by the Minister of Housing and Urban Development to value the property. Factors of influence during the property valuation exercise include the following;
- Size of the property
- Type of property (e.g. residential, commercial, semi-commercial, urban farm etc)
- Leases affecting the property
- Benefits or disadvantages linked to the property (e.g. accessibility, view and other desirable infrastructure)
- Market value: The value of a property as set on the open market
- Appraised value: The value placed on a property by a private appraiser. This is used for determining the value of a property when buying or selling property
- Assessed value: The value placed on a property by a municipality for the purpose of determining the property tax due
Points to Remember
- Rates are charged based on the value of immovable property
- A property owner may object against the value given to his property through the Valuation Court
- The Valuation Court deals strictly with discrepancies in property values and NOT rates
- Complaints pertaining to rates are attended to by Council
- An objection to the given valuation should be lodged within the time indicated in the Notice of Valuation
Differential Rating
The rates differ according to the following categories;
- Residential properties – used for the purposes of dwelling
- Commercial properties – used for business purposes
- Semi-Commercial – partly used for business and partly residential
- Government Land – owned by the Government
- Urban farmland – farms that exist within the urban boundary
- Vacant land – undeveloped land/plots
The Rating Process
Based on the above descriptions, Council determines a rate (tariff) to be charged on the various categories of properties. The Municipality runs an advertisement of rates in the newspapers advising property owners of the tariff to be charged during the year. Once all objections have been attended to and the new tariffs gazetted and published in the local print, the date from which the new tariffs will be effected is set out in the Notice of Rates Assessment. Council then uses the tariffs to calculate and prepare the rates bills that are sent to each ratepayer. Due to the fact that these rates are based on the different land uses it is referred to as differential rating.
Distribution of Properties in Manzini Urban Area
Sources of Funds for the Municipality
Rates Payment Options
In an effort to make rates payment simpler and quicker, the Municipal Council of Manzini offers the following rates payment channels to property owners;
Penalties and Legal Aspects
- Rates can be paid all at once/full payment or in installment over a period of a year. Overdue rates attract a penalty of up to 15% per annum, as per the Rating Act, 1995
- Letters of demand are issued immediately after rates became due and payable
- Defaulting properties/accounts are handed over to debt collectors if debt is still outstanding
Service Charges
Service charges include (but are not limited to) the following;
- Vending fees (Market & Street)
- Burial fees
- Zoning Fees
- Scrutiny fees
- Pound Fees
- Public Convenience fees
- Parking fees
- Refuse Collection fees
