Nairobi County is cracking down on property owners who haven’t paid their land rates. The move follows the expiration of a second waiver program that offered to forgive penalties and interest on outstanding balances. As of today, June 20th, 2024, the county is taking several steps to collect the owed revenue.
After a meeting held earlier this week, the Nairobi City County Executive Committee gave the green light for the County to start taking action against defaulters. Moving forward, the County will start auctioning properties with arrears. Nairobi Governor, Johnson Sakaja also recommended placing Caveats on the properties to prevent transactions or subdivisions. A Caveat is legal measure that will prevent defaulters from selling or transferring their properties. City Hall has authorized caveats on all properties with outstanding rates. This effectively freezes any land transactions until the arrears are settled.
The County Government is also using a third tactic to ensure all money owed ends up in their coffers. For properties generating rental income, the county has issued agency notices. This means tenants will be required to pay their rent directly to the county until the land rates are paid in full.
In May, 2024, the County Government published a long list of defaulters, giving them a one-month grace period to clear their dues. The 3,000 page list, with over 200,000 defaulters, contains property details, alongside the owed amount. The dues range from as little as a few thousands to tens of billions in the most extreme cases.
Governor Johnson Sakaja, in a recent cabinet meeting, emphasized the importance of collecting land rates. This revenue is crucial for funding essential county services. It’s unclear at this point how long the enforcement actions will continue, but it’s likely to remain in place until a significant portion of the outstanding arrears is collected.
Nairobi County is one of the wealthiest counties in Kenya with higher revenue streams compared to other counties. Since the onset of devolution, there has been a push and pull between County governments and the National governments with the former constantly asking for more resources. It seems counties are now focusing in upping their revenues rather than waiting on the National Government.
Undoubtedly, Land Rents and Rates will be a major focus for counties in urban areas as they are the easiest way to generate revenues.
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