South Africa's cities face similar challenges to their counterparts in the private sector in trying to match development and growth with the responsibility to redress the imbalances of the past.
While the usual suspects in such an equation focus on the provision of social services and facilities that cater to the basic needs of residents, a city's rates and taxes department can play a vital role in easing the burden on the poor.
A 2009 study prepared for the South African Cities Network and Urban Landmark sheds some light on the role that municipal rates policies can play in addressing the plight of the urban poor.
The report concluded that for this approach to have maximum effect, direct property tax relief measures must be narrowly targeted to the poor, reach a majority of the eligible population and yet, somehow, not be a burden on the municipality's resources.
The report further states that the residential rebate for qualifying households is undoubtedly the most effective and least costly mechanism to provide rates relief to the poor.
Local councils throughout the country apply varying types of rebates, mostly to residential properties, to try to alleviate the tax burden.
This is allowed under the Municipal Property Rates Act, which stipulates that all residents receive tax relief on at least the first R15 000 of the property valuation.
This minimum threshold was calculated at the time of the Act's drafting as it was determined to be the average market value of a government-subsidised RDP house.
Depending on the city, its size, location and financial muscle it can then apply for further relief on the same basis. This decision is left largely to the discretion of city officials and leads to great variances in how this threshold is set.
The City, for example, has increased this threshold to R200 000 of the property value, up from R150 000 previously.
According to the 2009 study, which calculated impact on the previous threshold, as many as 32% of the city's residents qualified for full exclusion from rates.
This may seem a high number, but the total value of the properties amounts to little more than R11.5-billion, or roughly 3% of the total value of residential properties and 2% of the entire valuation roll.
In terms of the contribution to the city's finances, property rates generally rank third after service charges and intergovernmental transfers.
In more affluent centres that are less reliant on such intergovernmental transfers, service charges and the contribution from property rates could rise as high as 20%.
The report indicates that while total municipal property rates revenue is expected to increase in the medium term, its share of total municipal revenue is declining as the other two components start to increase.
An interesting argument in favour of rates rebates for poorer households is the cost associated with administration and collection of bad debts for households that have little chance of affording the charges, or penalties and interest, in any event.
"Better information on collection rates at different income bands and the secondary residential property market in township areas can assist to improve the methodology for setting the residential exclusion threshold, thus improving its pro-poor benefits while respecting municipal revenue needs.
"Income-based rebates and other specific measures to address particular vulnerable groups can then be used to enhance the rates safety net for the poor," states the report.
"In the Johannesburg case, one of the factors in setting the residential exclusion threshold was the collection rate for lower-value properties, specifically avoiding the administrative burden and debt write-offs associated with chasing high numbers of low-amount arrears."
The complexity of devising an equitable tariff and rebate structure is also highlighted in the report, which states that municipalities struggle to identify poor households from the valuation roll alone.
As the rebate process puts the onus on the rate-payer to access the benefit, a number of beneficiaries are not taking advantage of the policies meant to assist them.
As the private sector's counterparts in the local councils are discovering, a pro-development agenda is possible, it just takes some fancy footwork to make sure it is effective and sustainable.