Small lifeline for Bay’s accommodation industry welcomed
Accommodation establishments charged commercial rates during the lockdown in Nelson Mandela Bay have a chance to have the fees credited on their municipal accounts.
However, the various establishments — which offer short-term stays such as hotels, B&Bs, backpackers and self-catering units — will still be charged for residential rates.
If an application is successful, the residential rates will be subtracted from the commercial rates with the accounts then credited.
This investment retention incentive has seen R12m set aside to assist the struggling tourism industry.
It was approved by the metro’s council on Monday without being debated.
The incentive will be run through economic development, tourism and environment (EDTA) boss Anele Qaba’s office.
The R12m will come from an unspent capital project grant given to the Mandela Bay Development Agency.
The money will be used to offset the commercial rate charges and avoid further financial losses to the city already struggling with a reduced rates collection.
Port Elizabeth Metro B&B Association chair Shena Wilmot welcomed the news, saying the sector needed all the help it could get.
“We were part of the process and negotiations in requesting the assistance and are grateful this was passed in council.”
She said the money would go a long way in helping the businesses, crippled by the lockdown as the sector came to an abrupt halt after March 15, when president Cyril Ramaphosa declared a national state of disaster.
In his report, interim mayor Thsonono Buyeye said he hoped the money would be used to keep the businesses operating in the city and prevent further job losses.
“The category of owners eligible for the investment retention intensive will solely be for tourism accommodation establishments that provide accommodation on a short-term basis.”
Th initial period will be for three months, froom April 1 to June 30. Buyeye said a review would be done before the period expired.
“EDTA through its investment incentive policy has identified this as a means of supporting tourism business on a local level to mitigate the damage caused by the Covid-19 virus,” Buyeye said.
“These measures are aimed at protecting the industry by offering support to existing legal tourism businesses to protect employment in the sector.”
He said the department hoped to minimise the effect on the formal tourism accommodation sector in the Bay.
To apply, entities must have operated for at least one year and be zoned for commercial accommodation in the Bay.
“Further to offering the support, the municipality will also engage and partner with the industry to promote and boost tourism after the nationwide lockdown to reduce the negative effect of the epidemic on tourism and to get the tourism economy and sector back up and running in a phased approached.”
When contacted, Qaba said the incentive was crucial in retaining the existing tourism businesses.
“It will be very unfair to charge businesses commercial rates while they are not operating due to government regulations. That will be no different from broad daylight robbery.
“The tourism sector is the backbone of the city’s economy and it therefore needs to be protected in each and every aspect.
“The incentive will therefore help to keep those accommodation businesses open and will thus protect jobs so that as the tourism sector opens it can immediately operate without any complications.”
Qaba said the municipality surveyed the number of accommodation establishments linked to various associations to determine that R12m was needed for three months.
Accommodation establishments were enthusiastic about the news.
Uitenhage’s The Garden Lodge Guest House owner Elise Engelbrecht said she had applied for the three-month rates holiday but had heard nothing back.
“However, if the municipality gets this right it would help and I would apply. It is a small amount but every cent counts.”
In Port Elizabeth, Retreat on Main owner Roxy Stottelaar said: “If they are willing to give anything back that would be great. It is better than nothing.”