A shakeup in Johannesburg outdoor advertising

The City of Joburg has mandated the Joburg Property Company (JPC) to manage its full portfolio on contracting of sites for the outdoor advertising and cell phone masts on Council-owned land and assets.

In the past, this function was performed by various entities who include the Joburg Roads Agency (JRA), City Power and the now merged Metro Trading Company (MTC). This resulted in  a gap in contracts, terms and conditions which were sometimes not  favourable to the City.

With the consolidated mandate, JPC will manage the following:

•           The awarding of sites in terms of Supply Chain Management policy for Land (SCMPL) and other applicable legislation/s;

•           Entering into lease agreements on behalf of the CoJ for all sites (outdoor advertising/Cell masts) proposed or erected on CoJ land/assets;

•           Management of lease agreements, that is, by ensuring proper monitoring and evaluation of these agreements, credit control, contract management, etc.;

•           Conducting research and developing effective outdoor advertising management systems and revenue model/s, and

•           Collection of revenue and disbursements to CoJ Departments and Entities.

•           Conduct a proper due diligence of all agreements and financial records to be handed over/inherited both from a financial viability and in respect to compliance with the City’s procurement policies, authority and applicable by-laws

JPC and JRA together with the City’s legal department have already started implementing the process of nullifying leases that were declared null and void. The City is also negotiating with existing contract holders whose projects were not awarded in terms of the SCMPL and all pertinent regulations in terms of the Municipal Finance Management Act. This will minimize the risk of litigation and claims for damages by those found to have unlawfully entered into such contracts.

Some of the benefits of the consolidation

•           Introduction of uniform norms, procedures and revenue model across the industry

•           Utilise the City’s portfolio to address commercial and social priorities of the City

•           Utilise the portfolio to support and encourage transformation in the industry

•           A consolidated citywide audit of the portfolio

•           Creation of a single management system to manage the portfolio

JPC outdoor advertising procedures

a)         Receive an application / proposal;

b)         Circulate proposals/applications to COJ Departments and Municipal Entities (MEs)  for comments

c)         Report to Council for approval of project

d)         Bid Specification Committee

e)         Advertise tender (4 to 6 week)

f)          Tender Evaluation Committee

g)         Tender Awarding Committee

h)         EAC report for approval of award as recommended by Tender Awarding Committee

i)          Contract Negotiations and Signing off of agreement

j)          Send Take on Form to Finance for capturing of agreement for billing purposes

k)         Billing and contract management

l)          Disbursement of revenue to CoJ or MEs

JPC objectives

The JPC objectives are to harness the City’s property portfolio transactions to increase economic growth and Broad-Based Black Economic Empowerment (BBBEE), while creating jobs and economic opportunities for the disadvantaged communities and businesses.

JPC does not use agents or brokers when leasing or selling property as legal requirements directs for an open tender system that allows all interested parties an opportunity to participate in the economic development of the World Class African City.

Prepared by and on behalf of JPC

Issued by the JPC

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