A simple summary of the Property Rates Act

The Municipal Property Rates Act (MPRA) No. 6 of 2004 governs how municipalities assess, levy, and collect property rates.

Chapters 4 to 8 of the Act focus on the valuation process and property rates determination.

• Chapter 4 mandates that municipalities conduct a general valuation of all rateable properties and compile a valuation roll, which is valid for up to four years. It also defines the role of municipal valuers, their qualifications, and their powers to conduct inspections.
• Chapter 5 establishes the valuation criteria, requiring market-based assessments and outlining the factors that must be considered or excluded when determining market value.
• Chapter 6 details the contents of valuation rolls, the public inspection process, and the procedures for lodging objections to incorrect property valuations.
• Chapter 7 sets up valuation appeal boards to handle disputes and review significant valuation adjustments.
• Chapter 8 ensures municipalities update valuation rolls annually through supplementary valuations or amendments.

Here is a summary of each chapter. You can download the Act here.

 

Chapter 4: General valuation of rateable property

This chapter outlines the process of general property valuation that municipalities must follow to determine property rates.

• Section 30: Requires municipalities to conduct a general valuation of all properties and prepare a valuation roll. Properties fully or partially excluded from rates must still be valued if required.
• Section 31: Establishes the valuation date, which must be within 12 months before the start of the financial year in which the valuation roll takes effect.
• Section 32: Specifies that a valuation roll is valid for up to four years, with a possible extension to five years in exceptional cases.
• Section 33: Requires the appointment of a municipal valuer, either a municipal official or an independent professional, through a transparent selection process.
• Section 34: Outlines the duties of a municipal valuer, including valuing properties, preparing the valuation roll, handling objections, and updating valuations when necessary.
• Section 35: Allows the appointment of assistant valuers to help with the valuation process.
• Section 36: Permits the designation of data collectors to assist in gathering valuation information.
• Section 37: Grants municipal valuers the ability to delegate certain functions to assistant valuers and data collectors.
• Section 38: Allows municipalities to collaborate and share valuation costs or a single municipal valuer.
• Section 39: Sets minimum qualifications for municipal valuers and assistant valuers, requiring them to be registered under the Property Valuers Profession Act, 2000.
• Section 40: Requires valuers to make a declaration before taking office.
• Section 41: Grants valuers the right to inspect properties, with proper identification and adherence to legal restrictions.
• Section 42: Ensures valuers have access to necessary property information, including ownership records and property details.
• Section 43: Establishes ethical standards for municipal valuers, prohibiting conflicts of interest.
• Section 44: Protects confidential information obtained during valuations.

 

Chapter 5: Valuation criteria

This chapter defines how properties must be valued for municipal rates.

• Section 45: Mandates that valuations follow generally recognised valuation standards. Physical inspections are optional, and technological methods like aerial photography and mass appraisal systems may be used.
• Section 46: Defines market value as what a property would sell for in an open market between a willing buyer and seller. Certain factors must be considered, such as property improvements and rights attached to the property. Some elements must be excluded, like mining structures, unregistered leases, and certain machinery.
• Section 47: Requires each sectional title unit in a sectional title scheme to be valued individually.

 

Chapter 6: Valuation rolls

This chapter details the contents, publication, and objections process for municipal valuation rolls.

• Section 48: Lists the required contents of a valuation roll, including the property description, owner’s name, market value, and category.
• Section 49: Requires a public notice to be issued for the valuation roll, allowing at least 30 days for public inspection and objections. Notices must be published in the Provincial Gazette, local media, and on municipal websites.
• Section 50: Allows any person to inspect the roll, request extracts (for a fee), and lodge objections to specific property valuations.
• Section 51: The municipal valuer must assess objections and either adjust or confirm valuations.
• Section 52: Requires compulsory review by the valuation appeal board if a property’s valuation changes by more than 10%.
• Section 53: Requires the municipal valuer to notify objectors of the decision and allows them to request written reasons for a fee.
• Section 54: Grants property owners and objectors the right to appeal to an appeal board if dissatisfied with the valuer’s decision.
• Section 55: Outlines how valuation roll adjustments affect rates payments and allows for refunds or additional charges based on corrected valuations.

 

Chapter 7: Valuation appeal boards

This chapter establishes valuation appeal boards to handle disputes over property valuations.

• Section 56: The MEC for local government must establish at least one valuation appeal board per metropolitan municipality.
• Section 57: Appeal boards are responsible for hearing appeals and reviewing municipal valuer decisions.
• Section 58: Defines the composition of the board:
  • A chairperson with legal experience.
  • Two to four members with property valuation expertise, including at least one professional valuer.
• Section 59: Lists disqualifications for board members, including insolvency, criminal records, and municipal debt.
• Section 60: Sets a four-year term for appeal board members, with eligibility for reappointment.
• Section 61: Allows the Minister to determine board members’ conditions of appointment and remuneration.
• Section 62: Requires board members to act impartially and disclose any conflicts of interest.
• Section 63: Provides for the removal of board members due to misconduct or incompetence.
• Section 64: Allows for the appointment of alternate board members.
• Section 65: Governs meeting procedures, requiring public hearings except for deliberations.
• Section 66: Allows appeal boards to request municipal administrative assistance.
• Section 67: Grants boards the power to set their own procedures.
• Section 68: Establishes quorum rules, requiring the presence of the valuer member.
• Section 69: Requires valuation rolls to be updated based on appeal board decisions.
• Section 70: Allows appeal boards to issue cost orders against frivolous appeals.
• Section 71: Authorises boards to establish committees.
• Sections 72–75: Grants boards powers to summon witnesses, access property, and obtain information for valuation appeals.

 

Chapter 8: Updating of valuation rolls

This chapter covers the annual updating of valuation rolls through supplementary valuations and amendments.

• Section 77: Requires municipalities to update their valuation rolls at least once a year, either through:
  a) A supplementary valuation roll (if Section 78 applies).
  b) Direct amendments (if Section 79 applies).
• Section 78: Supplementary valuations must be conducted when:
  a) A property was omitted from the roll.
  b) A property is newly included in a municipality.
  c) A property is subdivided or consolidated.
  d) The market value changes significantly.
  e) A property was incorrectly valued in the last general valuation.
  f) A clerical or typing error was made.
  g) A property’s category changed.
• Section 79: Regular amendments must be made to reflect property status changes, but section 78 must be followed if supplementary valuation criteria apply.

 

Overall Summary

• Chapter 4: Establishes valuation rules, appoints valuers, and defines their powers.
• Chapter 5: Details valuation methods and market value assessments.
• Chapter 6: Governs valuation rolls, public notices, objections, and appeals.
• Chapter 7: Establishes valuation appeal boards and their procedures.
• Chapter 8: Covers annual updates and supplementary valuations.