FREQUENTLY ASKED QUESTIONS
How will Siti benefits property owners in the area?
Property owners will enjoy various benefits by pooling their resources within the SRA. These benefits include a well-managed area, a shared sense of communal pride, enhanced safety measures, and social responsibility. Ultimately, these actions contribute to increasing property values as seen in areas in Stellenbosch with active SRA’s over the past few years.
What is Siti?
Siti is a Special Ratings Area (SRA) or City Improvement District (CID). SRA/CID is Municipal policy, allowing property owners a geographic area to pay a levy to fund supplementary and complementary services aimed at enhancing the physical and social environment of the area. All SRAs/CIDs operate as non-profit organisations. Siti, the name of our SRA, stands for the Stellenbosch Improvement and Transformation Initiative.
How will Siti be funded?
To fund its operations, Siti will collect a levy from property owners within the designated area. This levy is collected in addition to the normal rates charges. The collected funds, which are separate from the regular rates, can only be spent within the specific area. The money is used to provide "top-up" services according to an approved Business Plan. The services offered by Siti are supplementary to those provided by the Stellenbosch Municipality, which continues to deliver normal services.
The Municipality collects the additional rates on behalf of the SRA, although the funds do not go to the Municipality. They share an invoice to reduce collection costs. The additional rate appears as a separate item, labelled "improvement district," on the monthly municipal account of each property owner responsible for paying the SRA additional rates within the SRA.
How much will I pay?
Just like the Municipal Tariffs, the SRA tariff will be different, depending on whether your property is residential (RES) or business (BUS) - the SRA tariffs will work out to roughly 25% of your current Municipal property rate (see the 2023/2024 Municipal rates ).
Residential (Estimated):
0.005068 x 25% = 0.001267
0.01267 x R1m / 12 months = estimated R105.58 (VAT incl.) per month per R1m property valuation
Business/Commercial(Estimated):
0.010643 x 25% = 0.00266075
0.0266075 x R1m / 12 months = estimated R221.73 (VAT incl.) per month per R1m property valuation
The SRA management will verify the properties located within the boundaries of Siti, which are then linked to the municipal valuations based on the most recent general valuation roll maintained by the Municipality.
Annually, the SRA management prepares an overall budget for the year, taking into account the specific needs outlined in the approved Business Plan. Individual contributions are calculated by dividing the budget total according to the municipal valuations of each property, proportionally based on the total valuation of Siti.
The SRA Policy allows for differentiated tariffs based on property types, such as residential, commercial, or industrial. These tariffs are expressed as a Rand per unit and are applicable for the financial year starting on July 1.
The SRA budget and proposed tariffs need to be approved by the Municipality and are advertised for public comments and objections as part of the Municipality’s budget process before implementation on July 1 each year.
What are the benefits for property owners and members of Siti?
Property owners who participate in Siti can enjoy various benefits by pooling their resources within the SRA. These benefits include a well-managed area, a shared sense of communal pride, enhanced safety measures, and social responsibility. Ultimately, these actions contribute to increasing property values.
Why establish an SRA in central Stellenbosch?
For communities that desire a higher level of municipal services, an SRA provides them with the option to pay for these additional services in an affordable and sustainable manner. Typically, these services address urban management issues, including additional public safety measures, cleansing services, infrastructure maintenance, environmental improvements, and social services, among other
How will Siti be established?
The establishment of an SRA is initiated by the community rather than the Municipality. It usually begins with community members who champion the need for environmental improvements within a defined area. They compile a five-year business plan, which includes a motivation report, an implementation plan, and a budget that outlines how the improvements will be achieved. This plan is presented to the community during a public meeting.
Subsequently, property owners are approached for their support, requiring a majority (more than 50% in commercial areas and more than 60% in residential areas) to give written consent for the formation of an SRA.
Once the necessary consent is obtained, the steering group submits an application to the Municipality. The application is then advertised in the media, and property owners are notified, allowing them at least 60 days to provide comments or objections. The Municipality considers the application, along with any objections, during a full sitting of the Council.
After the Municipality approves the application, a Not-For-Profit Company (NPC) is established, and a board is elected. The NPC must register for VAT, open a bank account, and be registered as a vendor with the Municipality, among other requirements. All these procedures must be completed before any payment is made to the SRA by the Municipality.
Who will manage Siti?
Siti will be managed by a board of directors elected by its members. It will operate as a Not-for-Profit Company (NPC), with a management team appointed by the board. Property owners who wish to participate in the affairs of Siti must sign up for NPC membership. The day-to-day operations of Siti are independent of the Municipality, which exercises financial oversight and ensures legal compliance.
Who will monitor Siti’s finances?
Siti, as an SRA, will operate under the governance of the Companies Act (71 of 2008) and is responsible for managing its own finances. It appoints its own auditors, and the audited financial statements become part of the Municipality's consolidated accounts, subject to review by the Auditor-General. Additionally, monthly financial reports are submitted to the Municipality to monitor expenditure and ensure adherence to the budget. The SRA will be required to submit a Chairman's report and audited financial statements to the relevant Sub-council within two months of Siti’s Annual General Meeting (AGM) for review.
Will the payment of the additional rates be mandatory for all properties within the SRA?
Yes, if and when the Municipality approves the SRA, all property owners within the Siti boundaries will be required to pay the additional rates.