The Sunday News
Vusumuzi Dube, Senior Municipal Reporter
AS confusion continues to dodge the completion of the Egodini bus terminus rehabilitation project in Bulawayo, it has since emerged that council has been failing to get a development permit as it struggles to pay off some privately-owned properties within the project scope.
The local authority has been on a back and forth exchange with the South Africa-based contractor, Terracotta Private Limited which was awarded the tender to develop the project, with councillors at one point even threatening to cancel the tender accusing the developer of failing to meet set deadlines for the completion of the project.
However, it has since emerged that the Bulawayo City Council has all along failed to pay off two privately owned properties at the site hindering the registration of a Notorial lease which is key towards the issuance of a development permit. A Notarial lease agreement is a long-term agreement on immovable property attested by a Notary Public and registered in the Deeds Office.
According to a council report on the progress of the project, the city legal officer, Mrs Spekiwa Mugiya revealed that the local authority was in no position to demand the completion of the project.
“The last council had pushed for the cancellation of the project and proposed re-tendering. This had a lot of legal implications. Council had failed to register a Notorial lease because of the two outstanding properties which had not yet been paid for.
“The delay was mainly caused by lack of funding as initially this cost was to be borne by the developer but council decided to take it over. The developer wanted the Notorial so that funding could be sought. Council was therefore not in a position to demand fulfillment of the contract on the developer’s part when it had not fulfilled its cover obligations under the contract,” reads the report.
According to the report, the local authority’s chamber secretary, Mrs Sikhangele Zhou concurred with the city legal officer noting that it was imperative for the two properties to be purchased so that the whole site can be consolidated as one property.
“Council had not been able to fulfill its obligations due to funding challenges. She further advised that the cancellation of the contract at this stage was premature as the parties had to first put each other to terms. The process would be done administratively and at this stage the report was submitted to council for information only to enable council to explain to its stakeholders on the project,” reads the report.
According to a special town lands report on the project the main property that is stalling the entire project is owned by the United Pentecostal Church.
“At the time of contract award to Teracotta, there were eight properties either to be acquired or leases to be terminated. One property was on freehold, four on 50-year leasehold and three on short two to five-year leases. A serious challenge was encountered on acquiring the freehold property. The owner was not prepared to move on their asking price. Several meetings were done on the issue until council realised that time was not on its side in view of the urgency of the matter, hence agreeing to the asking price,” reads the report.
The local authority is also exploring the option of purchasing a property to compensate the single property on freehold.
“The acquisition of the stand was not a simple and straight forward transaction as it was subject to further negotiations. Council in March 2017 resolved to swap the stand for another one outside Egodini (stand 223 BT). However, United Pentecostal Church’s stand was valued at US$600 000 while the new stand was at US$400 000. This left a shortfall of US$200 000 which council did not have. The balance of the US$200 000 was liquidated by an additional purchase of six vacant church stands, offsetting of outstanding rates and cash payment,” reads the report.
In terms of the new projects as supplied by Terracotta, Phase 1A of the project, which is underway, is expected to be completed by September while Phase 1B has been set for November. Phase 1A, according to the contractor, includes the construction of 1 100 informal traders’ stalls, a 100-bay taxi rank, security wall, security tower, motor retail, taxi associations offices, public ablutions and a service lane.
Phase 1B includes the construction of the bus terminus building, fast food shops and the grocery anchor. The project which experienced a number of false starts since Terracotta won the tender in September 2012, is expected to gobble close to US$60 million, with the company also awarded with a 99-year lease to the terminus.
