Disposal of Immovable assets

01 September 2022 1373

Council is the owners of the largest number of properties in the Matjhabeng area. In its  exercise of its powers, duties and functions Council has the right to acquire, hold, enhance, lease and alienate immovable property.

The inequitable spread of ownership of property through out the Matjhabeng area and the historic causes thereof are recognized, and Council acknowledges that it has a leading role to play in addressing these imbalances by ensuring that the immovable assets under its control are dealt with in a manner that ensures the greatest possible benefit to the strategic objective of the municipality and the community that it serves.

The objective of the policy is to prove a framework for the disposal or transfer of immovable assets or rights thereof and the management and use of Council’s immovable property in the event that the property is not subject to disposal, in a manner that would support the strategic objectives of the municipality contained in its Integrated Development Plan, the Spatial Development Framework and the needs and aspirations of the community that it serves.

Why there is a necessity for a comprehensive land disposal policy

Section 14 read with section 90 of the Local government; the Municipal Finance management Act No 56 of 2003 prescribes that:

“The municipality may not dispose of any of its capital assets needed to provide a minimum level of basic municipal services, unless in a meeting open to the public, has decided on reasonable grounds that the assets is not needed to provide such a minimum level of basic municipal services. The fair market value of the assets and the economic and community value to be received in exchange for the asset must be considered. The transfer of ownership must be fair, equitable, transparent, competitive, and consistent with the Municipality Supply Chain Management policy.

It is thus apparent from the above that Council must reserve and mange immovable property in its ownership for municipal purposes aligned with its strategic objective and to use, enhance and improve such immovable property enclosed and cultivated. Council must reserve and manage immovable property in its ownership for its purpose and operational needs.

The Council may acquire immovable property and rights in the property by way of private treaty, cession, donation, and expropriation to support its strategic objectives.

Council may alienate immovable property and rights in immovable property in its ownership by way of a direct sale, public tender auction and donation.

Council may let immovable property in its ownership on a long term or short-term basis by way of direct negotiation or public tender.

Council may only alienate immovable property or rights in immovable property once it is satisfied that such property or right is not required to provide the minimum level of basic municipal services and once it has considered the fair value thereof as well as the economic and community value to be received pursuant to such disposal.

Before alienating immovable property or rights in property, Councill must be satisfied that alienation is the appropriate methodology and that reasonable economic and social return cannot be derived whilst ownership of the immovable property or rights is retained by Council.

All processes for the disposal of immovable property must be considered in accordance with this policy framework as set out below.

In addition to the above, any disposal should take into account that the municipality has a core responsibility to acquire and avail land and buildings, in the first instance, for its own use for purpose of developing and maintaining municipal infrastructure, promoting service delivery and for facilitating social and economic development and spatial integration. Land assets unrelated to these responsibilities are, by implication, surplus to the municipality’s requirements although future requirements must be acknowledged and hence the need to hold immovable property in reserve.

Thus, the surplus immovable property may be dealt with by the municipality in a manner that it deems fit, which is either to lease it out or dispose of it completely. All transactions that the municipality enters into, there should be maximum benefit to the municipality, its operational requirements and the broader community.