The Knysna Council has voted to enter into a one-year, R1.8-million lease extension for the Old Standard Bank Building, erf 711, which houses the municipal Customer Care Centre.
Since 2006, the Municipality has rented the historic Old Standard Bank Building from Mellville Development Company (PTY) LTD (what most would call Woodmill Lane). The original lease was for 10 years but after the Municipality failed to build or buy a building, the lease was extended for another year, due to expire at the end of this month, July 2017.
In between, Mellville Development sold to Albatros Property Trust (still Woodmill Lane).
A year ago, the Knysna Council approved the extension of the current Municipality finance building in Clyde Street. That would house the Customer Care Centre and continue the centralisation of municipal services in that street. The public would then own an asset rather than paying big business rent.
However, in the adjustment budget, the money for this project was removed which is now forcing another one year lease which will cost R149,000 per month.
For the taxpayer, that’s R1.8-million down the drain. Far more if you add the past 11 years rent.
The situation worsens when considering that Knysna Municipality rents another building from Albatros Property Trust. The Old Main Road Building has been occupied for 7 years by staff from the Technical Services and Planning & Development directorates. That lease is to be renewed at the end of this month for another 3 years, at approximately R3-million per year.