Full re-valuation of commerical rates on the way next year
COMMERCIAL rates for properties across Co Wexford will be re-valued next year as part of a national programme to modernise the rateable valuation of all commercial and industrial properties in Ireland.
The process has already been completed in Kilkenny, Carlow and Waterford and the signing of the new Valuation Orders followed on from the completion of a statutory consultation process between Wexford County Council, the Commissioner of Valuation, John O’Sullivan, and the Minister for Housing, Planning and Local Government, Eoghan Murphy TD.
The process will not affect residential properties or agricultural lands - neither of which are rateable.
While the valuations for Wexford properties will be published next year the new rates will not come into effect until 2020.
According to the Valuation Office (VO) the new figures will be based on rental values as of September 15, last year, and these values will be used to levy rates from 2020.
The VO also says that following the process there ‘will be a much closer relationship between the rental value or valuation of a property and its commercial rates liability’ and that the purpose of the re-valuation is to redistribute the commercial rates liability more equitably between ratepayers rather than to increase the total amount of commercial rates collected by the local authority.
There are three figures relevant to commercial rates: the overall rates contribution to the annual budget as decided by the members of the local authority; the Rateable Valuation of Individual Properties (Net Annual Value) as determined by the Valuation Office, and the Annual Rate on Valuation (ARV) which is set by the Co Council elected members.
Speaking to this newspaper about the measure Declan Lavelle, Head of Valuation Services in the Valuation Office, said his office does not make up the rental value of a property.
‘This is a process that is done through a statutory framework and that is what we are guided by,’ said Mr Lavelle.
‘The local authority decides what it wants to collect [in commercial rates] in November and they look at the total value that we have assessed and that is divided into the total amount they want to collect and a percentage of that has to be collected in rates,’ he added.
As part of the process the rental value of properties will be looked at in each of the county’s four principal towns in addition to Bunclody and also businesses operating in rural areas.
A number of factors are considered when estimating the valuation of properties including location.
When asked if footfall is a factor that is considered within the overall process Mr Lavelle said that is reflected in rental value.
‘Basically, where there is a high level of footfall there is invariably a higher rent as well,’ he said.
Significantly, the valuation of properties in Co Wexford is based on market conditions in the 1980s and that’s one of the reasons why the re-valuation process has been initiated.
‘It needs to be brought up-to-date and modernised,’ said Mr Lavelle while also pointing out that the re-valuation does not necessarily mean commercial rates will go up for business owners.
In counties like Leitrim and Longford, where the process has already been completed there were reduced rates liability of 70 per cent and 65.4 per cent, respectively.
It’s proposed that an initial valuation certificate will be issued to businesses in Co Wexford in the first quarter of 2019.
‘We will write to every rate payer [in the county] and tell them what we think is the estimated value of their property,’ said Mr Lavelle.
‘The local authority will then give a percentage of that - which they will have to pay [in commercial rates],’ he added.
Mr Lavelle also said that business owners are encouraged to avail of the Valuation Office’s walk-in service which will be set up in the county following the issuing of certificates to deal with any concerns of queries people might have with regard to the estimated valuation put on their property.
‘We will have walk-in clinics and rate payers will be able to talk to our valuers,’ he said.
If a rate payer is disappointed with their assessed value there will be an appeal procedure they can follow, however, the appeal - which can be made to the Valuation Tribunal - will have to made within 28 days of the valuation list being published - which is expected to be September 17, 2019.
While there will be no fee involved in the walk-in clinic service a statutory fee will apply to appeals.
Following the initial written assessment a certificate of valuation will be issued within 40 days.
Mr Lavelle highlighted that within every county, each town and area is different.
He said there will be a difference in rent for a property on the busiest high street in the county compared to a property in a rural location and the rental value will reflect that.
‘There is a significant difference between market conditions back in the 1980s compared to now,’ said Mr Lavelle.
He also commented that in some ways Wexford town is unique because in a lot of urban areas the main shopping precincts are being moved to the outskirts whereas Wexford still has a very busy main street.
‘The rates [based] on the 1980s market will reflect that and the re-valuation is the only mechanism we have to control that,’ he said.
Mr Lavelle added that the overall aim of the process is to make sure there is equality and uniformity for all rate payers.
He also said it’s important that business owners read the letter issued to them in the first quarter of next year outlining the initial rateable valuation on their property.
‘I would urge people to study it and look at the valuation because we want this to be fair,’ he said.
‘Take time to take the information in and then avail of the walk-in clinics when they begin,’ he added.
Mr Lavelle confirmed that the process will not lead to countywide valuation estimates and that each town and area will be treated separately.
He and his colleague, John O’Sullivan, who is Commissioner of Valuations, met with Chamber representatives and business owners in Enniscorthy last week to discuss the process.
During the private meeting the two explained the detail of what will be involved.
It’s expected a re-evaluation will be repeated every 5 to 10 years.