[Susan Scott]

Can anyone interpret what this part of the proclamation means, please? – in plain English!
25. Rating structure and categorisation of land for rating purposes
(1) This clause applies to the levying of rates for the 2016/2017 rating year.
(2) The structure for rates applied by a former council to rates levied for a parcel of land
in a former area for the 2015/2016 rating year is to be applied by the new council to
that parcel.
(3)The category or sub-category applied to a parcel of land in a former area for rating
purposes for the 2015/2016 rating year is to be applied by the new council to that
parcel.

[Susan Pardy]

Hi Susan,

I have been thinking about this all weekend and I have an issue that I can’t logically reconcile. I will try to get it out, and see how I go about explaining my issue and see if anyone can help me work around it…

I think the idea of items 1-4 is an attempt to give Council a way to use our current rating structures in the new financial year. I read “rating structure” as the use of categories, sub-categories, ad-valorems, minimums and bases. So it sounds to me that the current sub-categories and methodologies for levying rates from each category and sub-category need to remain unchanged.

However, if the New Council needs to “make” a rate by resolution of the New Council, I don’t know how we go about the “catch-all” categories of Farmland, Residential and Business (ie. where you must make a rate for Farmland, Residential and Business for those parcels of land that do not fall within a sub-category). Presently, both Council A and Council B will have their own “catch-all” AV/Min/Base. So does that mean that New Council needs to and can only have one “catch-all”? For example, I can’t see how New Council can “make” two different Farmland rates because that would contravene the Act (the New Council can only have one Farmland rate – there can’t be one for Former Council A and Council B … and I can’t find a way to sub-categorise them; and even if I did, would creating new sub-categories which contravenes the rules (2) and (3) that the sub-categories can’t change). This problem (as I see it) extends to Residential and Business also … there are parcels which don’t get sub-categorised and are therefore rated as per the “catch-all” category: but how do two catch-all categories come together if we can’t change rating structures?

I might be way off track, but figure it’s worth us all putting in our ideas here on this forum, so if anyone else has anything to add (or can help me find the solution to this issue) please let me (and all of us) know.

Cheers
Susan

[Cherie Muir]

Hi all

Fun and games huh? My thinking is this:

Given that we know there is a 4-year freeze then maybe the key to clause 25 is
25(4) where it says … “it does not matter that different rating structures apply to different parcels because of subclause (2)”. Meaning we will have Residential ad valorem A (applies to the area formerly council A) and Residential ad valorem B (applies to the area formerly council B) … and so on.

The new council drafts one new Op Plan and the one new Revenue Policy in the Op Plan will be an amalgam of all pre-merger rating structures (it will continue like this during the freeze period anyway).

Cherie

[Susan Pardy]

Hi Cherie,
That was what I was thinking too in trying to work out a workaround. I originally thought that 25(4) was about parcels of land that were not categorised the same, but after having a conversation internally we are thinking the same as you … that clause 25(4) suggests that we can have different methodologies of calculating rates (Av/Min/Base) for land that is categorised the same.
Thanks kindly for your input.
Susan

[Ken Van de Werken]

Hi all
These are some issues I went through with the Upper Hunter Shire amalgamation in 2004:-

Base Amounts or minimums – For an amalgamated Council you cannot have base rates and minimums in the same rating category, but check the exact details with the Office of Local Government. This was not an issue for Upper Hunter Shire as the decision was made to have all minimum rates and not base amounts. Sections 497, 498, 499, 548 LGA 1993.

Land values with different base dates – Upper Hunter Shire Council consisted of 3 former Councils with valuations on different base dates.
I contacted the Department of Local Government and was advised that for the first year of the amalgamation we could have 3 different rates in the dollar and minimums for each sub category provided that we requested written permission from the Department to do so and we had a written undertaking from the Valuer General to provide a new GVal for the amalgamated Council for the second year. Section 498 (3) LGA 1993.
Regards Ken.

[Robert Hay]

Hi Everyone
My opinion of the proclamation is this.
(1) The proclamation only applies to 2016/2017 you never know there might be another for 2017/2018 we don’t know.
(2) Whatever your pre merge rating structure was, as adopted for the 2015/2016 rating year remains. What I mean by this is if you had a base amount in your residential category you cant change it to include a minimum. If you had a 70/30 split in your business to residential ratio you cant now change it to say 60/40. I don’t think a major change would be allowed (excluding any SVs already granted).
(3) Whatever your pre merge categories were they now apply to the new Council. This means that you would have a Council A Residential category and rate in $ and a Council B Residential rate in $ and so on.
When the revenue policy goes to the New Council for adoption it would include the pre merge Councils revenue policies that had been on display.
Happy to add my two cents. Please add yours as the more discussion the more likely we’ll have a good consensus on this matter.
Robert

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