The government has proposed to introduce stringent regulations for leasing road reservations, with proposed fees requiring street vendors to pay KES 3,000 daily for temporary structures within cities.
If approved, a temporary settlement of up to six months will attract KES 100 for every square metre per day with a minimum of KES 3,000 if the road is within cities. Charges outside cities will be KES 50 per square metre daily subject to a minimum of KES1,000.
Additionally, Kenyans will also be forced to pay a one-off fee of KES 50,000 to be allowed to direct storm water into public road drainages.
For short-term leasing of road reserve space spanning from six months to four years, applicants will incur KES 55,000 in application, processing, and administrative charges, alongside an annual rental fee equivalent to 15 percent of the undeveloped site value, with an additional five percent annual rental escalation rate.
The new charges are contained in the draft Kenya Roads (Roadside Stations) Regulations, 2023 by the Ministry of Roads and Transport. The fees will be paid on top of what the county governments charge traders and other businesses operating within their jurisdictions.
In addition to this, Kenya National Highways Authority is also proposing to levy a KES 50,000 one-time fee for people seeking to construct access roads to their private premises. and a KES 5,000 application fees to top it.
Building an access road to establishments such as shopping malls or department stores will incur a KES 5,000 application fee, with an additional one-time charge of KES 300,000 upon approval.
The state agency will also allow the leasing of road reserve space to private individuals and businesses for up to 29 years as it seeks to raise money from undeveloped land earmarked for future roads.
Applicants interested in leasing road reserves for durations between 10 and 29 years within cities will be required to pay KES 420,000 for application, processing, and administrative fees. Outside cities, the charges will amount to KES 330,000.
The long-term lease will then attract 15 per cent of the unimproved site value as a stand premium, followed by annual rent equivalent to 10 per cent of the unimproved site value. After every five years, there will also be 15 per cent rent escalation fees for the unimproved site value.
