by Ronan Casey
It appears that brand new business premises in Westmeath will avoid paying hundreds of thousands of euro to the local authority in rates in their early years because of an overload of work being experienced at the State’s main rates valuation office.
Big new businesses like the new Mullingar Lidl on Patrick Street (due to open in two weeks) may not have to pay rates for three years as Ireland’s state property valuation agency ‘Oifig Luachála/Valuation Office’ is swamped with applications, and has thus far attended to the rates backlog and revaluation of just three counties.
It is estimated it will take at least two years to get to Westmeath, meaning that new builds and new businesses in them will not be assessed for rates and will therefore not pay any to the local Council.
To add insult to injury, local councillor Peter Burke (FG) has found out that these rates will not be backdated, which he says is a “kick in the teeth” to established businesses, particularly those in large premises who have struggled to stay open in the past decade.
He says he is bringing the matter direct to the Minister for the Environment’s door in Dublin after the anomaly was discovered when Burke was charged with re-writing the Council’s 2015 budget statement for the FG/FF coalition on Monday evening.
“The council’s budget was meant to contain sweeteners in rates for new businesses, but we didn’t expect to hear this,” Cllr Burke told Topic. He says when he and fellow FG and FF Councillors asked the Council Executive about when the monies from the new Lidl would arrive, they were told of the backlog in Dublin.
“There is a delay in getting to new premises, as all the Valuations Office resources have been taken up with Dublin, Limerick and Waterford which means new businesses in Westmeath can’t be rated,” says Cllr Burke and “there is no retrospective treatments” meaning they won’t have to pay rates for the first few years they are in business.
“To the people in business who have done their best to pay rates this is unfair and a kick in the teeth,” Burke added. “It’s a totally unacceptable situation to find that the Government is holding the local government system to ransom.”
A spokesperson for the Valuations Office said despite staffing pressures they engage with local Council’s as soon as they can with new buildings such as a large supermarket. “We give priority to new builds and engage with local authorities and try to get to them as quickly as possible,” he said.
He confirmed they received notice to deal with the case in August 2014 and they hope to do a valuation on it in a few months time. However he did say the Council can collect a rate in lieu of the valuation.
RATES REDUCTION
The news that new builds will not be rated for at least two years emerged just as the local council had introduced a new measure aimed at encouraging occupation of vacant retail, office and business premises.
At the outset of a marathon nine hour Budget meeting on Monday, County Manager Pat Gallagher proposed a Business Incentive Scheme to encourage the reuse of vacant commercial property. It involves the payment of a grant of 60% of the annual commercial rate in the first year that the vacant property is brought back to use, 40% in year two and 20% in year three.
Mr Gallagher also wanted the owners of vacant premises to pay a small amount of the annual rates. At present, they enjoy a 100% waiver on rates, but his proposal to reduce the waiver to 80% was shot down by the majority of County Councillors. Mr Gallagher said the waiver cut was the only way of paying for the Business Incentive Scheme, but Councillors disagreed and led by accountant and FG Councillor Peter Burke, and FF’s Paul Daly, they highlighted other areas where the estimated €285,000 to fund the scheme could be raised. However, Labour, Sinn Fein and the Independents opposed this.
There was arguments and heated debate as cuts were made to spending in a variety of other areas including housing (€70,000), festival funding (€40,000), roads (€100,000) and business promotion (€20,000) as well as reducing the rates grant in year one for new businesses in previously vacant properties to 40% in year one.
Claims that grants for people with disabilities would be hit as a result of a decision taken by the FG/FF Councillors on Monday night were strongly dismissed. There is seething anger on the back benches that a huge swathe of cuts were taken to other areas, while they did feel that Mr Gallagher’s waiver proposals were fair.
FG/FF contended that the housing cut could be added back in with planning income and NPPR revenue which is expected to exceed what the Council predicted.
