Online Reporter
Nqobile Bhebhe
Bulawayo City Council has proposed a social infrastructure levy of five to 10 percent of purchase price on stand sales and subdivisions to bridge the capital funding gap, facilitate the construction of recreational and community facilities in new suburbs, and make sure those benefiting from densification pay towards the costs arising from this policy.
The council currently faces a backlog of 25 primary schools across the city and urgently needs to construct two clinics in Cowdray Park and Emganwini. Additionally, composite community centres offering youth clubs, vocational training, and women’s clubs are lacking in these areas.
The proposed levy, seen as an innovative financing mechanism, aims to address the shortage of essential social amenities such as schools, clinics, community centres, and recreational spaces. Funds collected through the levy will be ring-fenced in a dedicated account to finance these projects.
The council’s mandate to provide community service facilities falls under its department of housing and community services. Community facilities are defined as those that serve the public interest, including halls, recreation centres, schools, libraries, parks, and emergency services.
Ideally, these amenities should be available in residential areas for ease of access. However, many newly developed suburbs, including Emganwini and Cowdray Park, lack such facilities.
A recent council report highlights the pressing need for recreational centres, vocational training facilities, community halls, and schools in these areas. Despite demands from residents and stakeholders, the lack of capital funding has hindered progress in providing these amenities.
“Construction will ensure that all newly built residential areas are serviced and have their own social facilities. For example, council policy requires a primary school for every 500 households, which is not the case, especially in new and fairly new suburbs,” the report noted.
The council emphasised that comprehensive housing provision goes beyond dwellings, requiring adequate support services to foster a complete and thriving community. Benefits of such infrastructure include proximity to essential services, employment opportunities, and improved neighbourhood perceptions.
Historically, such infrastructure was funded through mechanisms like beer levies, donations, and council capital funding. However, these funding sources have become inconsistent, necessitating the introduction of the social infrastructure levy policy.
To tackle the infrastructure deficit, the council proposes a levy on stand sales and subdivisions. The levy rates will vary by property type and location: High-density residential areas at 5 percent of the purchase price; medium-density areas at 7 percent; low-density and industrial areas at 8 percent; commercial stands at 10 percent; and subdivisions of existing stands at a flat rate of US$500 per transaction.
The council has stipulated that no sale will be finalised without payment of the levy. Moreover, contracts with private developers will include a requirement for them to fully construct at least one social facility, such as a sports ground complete with a football pitch, running track, borehole, and an office with storage space.
The need for innovative financing mechanisms for social infrastructure was highlighted in a 2021 audit report by the council’s audit section. The report suggested adopting the development impact fees from the model used in some international cities.
“These fees are assessed when a developer applies for a development permit within the area under development. It is calculated by dividing the total estimated cost of a recreational project among the projected population at full community build-out, including both residential and non-residential properties,” read the audit report.
This model ensures that development projects contribute directly to the funding of necessary community facilities. The council sees the proposed social infrastructure levy as a local adaptation of this approach.
By implementing the levy, the council aims to ensure that all residential areas are equipped with essential social facilities, fostering sustainable urban development. The proposed policy also seeks to enhance service delivery and align with the city’s vision of improving the quality of life for its residents.
The council stressed that timely implementation of the proposed policy will bridge the existing infrastructure gap, ensuring that future housing developments are accompanied by the necessary community amenities.
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