Otji faces N$13.5m regional council debt

A long-running difference over how a 5% share of assessment rates should be calculated has left the Otjiwarongo municipality owing the Otjozondjupa Regional Council N$13.54 million.

According to the municipality’s 7 September management committee agenda, the outstanding amount covers the period from 2010 to June 2026.

The document states that the municipality and regional council had different balances, with the municipality having applied a payment method based on collections rather than the full amount billed.

Municipality CEO Mberipura Hifitikeko, responding to questions from Namibian Sun yesterday, said the municipality’s position is that the outstanding balance arose from a difference in the payment methodology applied by the two institutions.

In 2020, the municipality adopted a council resolution following discussions with regional council officials.

However, Hifitikeko said the payment arrangement was never formally submitted to the regional council for its resolution and approval.

The issue surfaced again in 2025 when discrepancies were identified between the balances held by the two institutions.

Their subsequent reconciliation established that the municipality owed the regional council N$13.7 million for the period from 2010 to May 2026, calculated at 5% of the total amount billed.

The balance increased to N$13.8 million by the end of June, before the municipality paid N$300 000 following an engagement with the regional council on 29 May, reducing the outstanding amount to N$13.5 million.

Hifitikeko said the N$13.5 million therefore did not accumulate from a single year but represents the balance established through the reconciliation of records covering 2010 to June 2026.

Approval on the table

Under Section 77 of the Local Authorities Act, municipalities are required to pay 5% of assessment rates to their regional council. The dispute arose over whether that 5% should be based on rates billed to property owners or the amount actually collected.

Following further engagements, the regional council agreed to a payment arrangement proposed for council approval.

Under the arrangement, the municipality will pay 5% of the amount actually collected each month, while also paying N$70 000 per month towards the existing arrears from the end of September.

The arrangement is to be incorporated into a formal agreement between the municipality and the regional council and reviewed by June 2027.

The municipality’s agenda says the proposed arrangement is intended to settle the outstanding balance while allowing the 5% payment to be calculated on actual monthly collections rather than levied balances.

The matter was tabled for discussion and recommendation before the municipality’s council.

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