State biggest land rates defaulter, says City Hall

The national government is City Hall’s biggest defaulter in payment of land rates. The arrears have accumulated to Sh120 billion.

City Hall is accusing government institutions of deliberately dragging their feet in paying rates, hurting the annual revenue targets.

The Nairobi County Assembly Budget and Appropriations Committee on Monday was told the rate arrears could double if requisite measures are not put in place to ensure defaulters pay.

The county government has since 2013 struggled to meet its targets from land rates. It has collected Sh12.9 billion against a target of Sh21 billion for the period.

The county has a Sh4.6 billion target from land rates for the year ending June 2019, but has only collected Sh206 million and Sh165 million in the first and second quarters of the year, respectively.

In 2017, the county assembly amended the Revenue Act 2015 to give City Hall powers of temporarily repossessing properties of defaulters.

County head of rates Albert Okiro told the committee that efforts to ensure prompt compliance have hit a snag.

Okiro said most government institutions have resorted to legal battles that take long to resolve.

“All government institutions, some of them parastatals, and all the police stations are the biggest defaulters,” Okiro told the committee.

He said lack of title deeds by the majority of property owners has greatly hurt payment of rates.

Committee chairman Robert Mbatia said rates collections have been dropping since 2016, despite charges being a constant rate of 34 per cent.

Mbatia said the county has no scientific and realistic targets from land rates, making it difficult to ascertain figures being floated by the rates department. “Does the county have any scientific way of arriving at these figures?” Mbatia asked.

But Okiro said lack of a proper integrated system for land rates payment has made it difficult to get accurate results.

He said the Local Authority Integrated Financial Operations Management System is “old” and often doesn’t give accurate results.

The county has over the years been forced to clamp down properties, but the strategy seems not to be yielding desired targets.