‘We Look After Our Own Canals’

The privatisation of maintenance of St Francis Bay's canals and municipal jetties, including dredging of the canals, could soon be a reality. Steps are being taken to form a Section 21 company to administer the on-going project.

This comes after more than three years of grumbles by canal home owners that they have been paying canal levy fees for maintenance and that there's been nothing to show for it.

Kouga Council has agreed in principle to the privatisation, depending on objections from the public to the scheme, and other formalities. A public meeting held this month outlined requirements for a Section 21 company to be formed. According to Benny Morsink the privatisation proposal was unanimously approved and there was not one objection at the meeting, attended by around 100 people, nor has he received any objections in writing.

He reveals he has plus 300 votes of acceptance for the plan. Benny who currently represents a canal home owners' steering committee, says a Home Owners' Association (HOA) is also to be established prior to the Section 21 Company.

The SFB Residents' Association (RA), fully supports the concept of privatisation of the canal system, in placing responsibility for maintenance of the canals in the hands of a responsible and properly constituted body comprising riparian owners on the canals. In a statement the RA said it favours a Section 21 Company with a democratically elected Board of Directors, which will contract with the municipality to maintain the canal system in return for appropriate financial support from the latter, and which will be administered by the company. The municipality would simply out-source the management of the canal system to the Section 21 Company.

Questions of concern by the RA included the HOA steering committee's confidence that a non-response from homeowners represents a vote in favour of the proposals, and that a vote of 50%+1 of the riparian owners will be sufficient to establish the Association.

The RA suggested certain safeguards, including:

• There is inadequate provision for protection against liability for latent defects in the canal system. Examples are unresolved problems presented on Moby Dick Wharf by the new canal extension; and possible break-through by the sea into the ski basin. The agreement with Council should cover only dredging of the canal system and maintenance of municipal jetties, and not the viability of the canal system as such.
• The current municipal dredger needs to be fully re-conditioned, to the satisfaction of a competent assessor, or replaced. No agreement should be signed which does not clearly place responsibility for this with the Municipality.
• The need for a full professional investigation of the canal system by the best available expertise, to indicate the most cost-effective way to deal with the problems. This could influence the agreement. The RA is prepared to finance an initial investigation by ASR Ltd, New Zealand , whose expertise also extends to canal construction. Current levels of expertise are based entirely on local knowledge and experience, and the projected costs are significantly greater than those which would apply internationally.
• The proposed agreement with Council, that all income received from riparian levies, boat registration and fines, less a 5% handling charge, be paid into a fund which is ring-fenced for expenditure on canal maintenance, is welcomed. However, a clause should be added that this fund is to be administered by the Company, audited annually by an external auditor approved by both the Municipality and by the Company.
• The revised draft agreement should be vetted by an independent professional firm of attorneys. The RA is prepared to sponsor this.

“However, this is a major responsibility for the community; great care needs to be taken in the way the body is established and with its agreement with Council to ensure property owners are not prejudiced in any way,” the statement cautioned.