Water costs, in most cases, are a body corporate’s single largest expense. This is mainly due to bulk water meter systems being installed in most developments pre-2004.
Often non-payment of levies by tenants or owners leads to the body corporate being placed in a difficult cash flow position where they are unable to pay municipal rates and water costs for the scheme; which in turn can lead to water being cut off for the entire building due to the non-payment of only a few tenants or owners.
“In many cases we find that tenants and owners in sectional title schemes are not too concerned with water usage as this has always been an expense carried by the body corporate,” says Johann le Roux, Executive Director of Propell.
He says they are not too concerned with leaking toilets, geysers or taps as the perception is that this amount will be covered by the body corporate and therefore included in their levy amounts.
In many sectional title schemes over-crowding of units has become an issue and due to the bulk water meter systems, the smaller households end up ‘sponsoring’ the over-crowded units.
Notwithstanding the environmental impact of water wastage that will catch up with society soon enough, there is a fear that water tariffs will go the same way as electricity costs in the near future.
Often non-payment of levies by tenants or owners leads to the body corporate being placed in a difficult cash flow position where they are unable to pay municipal rates and water costs for the scheme; which in turn can lead to water being cut off for the entire building due to the non-payment of only a few tenants or owners.
Bodies corporate need to address water issues, if not just for their own financial welfare, but also for the environmental social responsibility issues, says Le Roux.
“Our suggestion to each of the sectional title schemes and bodies corporate that we work alongside is to install individual water meter systems for each of the units within their scheme. By doing so the body corporate would no longer be responsible for the water usage costs, since each individual owner will be expected to pay the municipality directly.”
The installation of water meters would form a special project and in most cases a special levy would need to be raised. Another option would be for the body corporate to obtain finance for the project.
According to Le Roux in most instances the monthly water cost saving of the body corporate can cover the instalments for a loan for the installation of individual water meters.
Thus no special levy would need to be raised, he says, once this loan has been repaid, the saving could help the body corporate’s cash-flow and reduce the need for future drastic levy increases.
In short everybody wins - the owners, the scheme, the landlord and even the environment, he says.