Appendices

Rates Remission Policy


(Note: the Rates Remission Policy was adopted by Council as part of the 2012-22 Long-term Plan and amended as part of the 2014/15 Annual Plan)

1. IntroductionTop

In accordance with Section 85 of the Local Government (Rating) Act, 2002:

i. A local authority may remit all or part of the rates on a rating unit (including penalties for unpaid rates) if –
a. the local authority has adopted a remissions policy under section 102 of the Local Government Act 2002, and
b. the local authority is satisfied that the conditions and criteria in the policy are met.
ii. The local authority must give notice to the ratepayer identifying the remitted rates.

2. Circumstances Where A Remission May ApplyTop

2.1 RURAL OPEN SPACE REMISSION

Remission statement

The Council may grant a 50 percent remission on land classified as rural under the District Plan where the rating unit is rated under the Base differential and used principally for farming or conservation purposes.

Policy objective

To provide rates relief for rural, farmland and open spaces.

Conditions and criteria

Land used principally for farming or conservation purposes

A rates remission of 50 percent of the Base general rate will be granted to rating units that are classified as rural under the District Plan and used principally for farming or conservation purposes. Under this policy ‘principally for farming or conservation purposes’ is defined as where:

a. The rating unit (or property) exceeds 30 hectares in area, and
b. 50 percent or more of the rateable capital value of the property is made up of the land value, and
c. ​the principal use of the land is for conservation, agriculture, horticulture, pastoral or silviculture purposes, or for the keeping of bees, poultry or other livestock excluding commercial dog kennels or catteries.

2.2 REMISSIONS ON LAND USED PRINCIPALLY FOR GAMES OR SPORT

Remission statement

Where the Council considers a rating unit is used principally for games or sport, it will apply a 50 percent remission of general rates where the rating unit:

a. has a club licence under the Sale of Liquor Act 1989, and
b. would otherwise qualify as 50 percent non-rateable under Part 2, Schedule 1, of the Local Government (Rating) Act, and
c. ​the property is rated at the Base differential.

Policy objective

To reduce the adverse financial impact of the Local Government (Rating) Act 2002 on land used principally for games or sports, occupied by clubs that hold a club liquor licence and no longer qualify as 50 percent non-rateable.

Conditions and criteria

All applications must be received in writing using the Wellington City Council ‘Application for Remission’ form. A remission under this policy will apply for one year only. Applicants must reapply annually. The application for a rate remission must be made prior to the commencement of the rating year (1 July). Successful applications received during a rating year will be applicable from the commencement of the following year. No applications will be backdated. For the avoidance of doubt, this policy specifically excludes chartered clubs and clubs holding permanent charters.

2.3 REMISSION OF TARGETED RATES ON PROPERTY UNDER DEVELOPMENT OR EARTHQUAKE STRENGTHENING

Remission statement

The Council may remit part or all of the commercial sector and downtown targeted rates on land classified under the Council’s commercial, industrial and business differential as defined within our Funding Impact Statement Rating Mechanisms, where the property is deemed to be ‘not fit for purpose’ due to the property being under development or due to the existing building being earthquake strengthened.

The Council may remit part or all of the Base sector targeted rate on land classified under the Council’s Base differential (including residential) as defined within our Funding Impact Statement Rating Mechanisms, where the property is deemed to be ‘not fit for purpose’ due to earthquake strengthening.

Policy objective

To provide rates relief for property temporarily not fit for purpose due to the property undergoing development or earthquake strengthening and therefore not receiving the benefits derived by contributing to the commercial, residential or downtown targeted rates.

Conditions and criteria

To enable the remission statement above, ‘not fit for purpose’ is defined in this policy as where:

a. the property (rating unit) will not hold sufficient consents to permit occupation and,
b. the property (rating unit) will not be used for any purpose, apart from the construction of buildings, premises or associated works, or earthquake strengthening works and
​c. ​the property (rating unit) will not generate any revenue stream

The above criteria apply to, and must be met by, an entire rating unit as identified in the Council’s rating information database (RID) and apply only for the period the building is not ‘fit for purpose’.

2.4 REMISSION OF VOLUNTARY RESIDENTIAL METERED WATER RATES

Remission statement

The Council may grant a remission on a voluntary residential metered water rate where excess water consumption has occurred due to a leak beyond the point of supply on the ratepayer’s property. The excess water consumption may only be remitted to the level of the current Greater Wellington Regional Council bulk water rate.

Policy objective

The objective of this remission policy is to provide a measure of rates relief where a water leak has been detected on the ratepayer’s residential property with a voluntary water meter, and prompt remedial action to repair the leak has been undertaken. However the ratepayer is responsible for water leaks, the pipes and the usage of water on their property in accordance with the Water Services Bylaw.

Conditions and criteria

A remission of the residential metered water rate may be granted for excess water consumption where the leak is the rate payer’s responsibility (beyond the point of supply). Excess water consumption will be calculated as the difference between actual metered usage on the latest reading and the average daily metered usage over the last four readings. The full water rate will be charged on the average daily usage over the last four readings and the excess water consumption (as calculated above) will be charged at the current Greater Wellington Regional Council bulk water rate. This remission should only be applied for if:

i. the leak occurred on a voluntary residential metered water property; and
ii. excess water consumption has occurred through a broken or leaking pipe; and
iii. ​evidence is provided that the fault has been remedied within a reasonable time period and prior to the application for a remission

In the advent of a recurrence of a water leak, the Council would require the property owner to get a condition assessment of the pipes on the property prior to any decisions to remit a subsequent remission.

2.5 SPECIAL CIRCUMSTANCES REMISSION

Remission statement

It is recognised that not all situations in which it may be appropriate for the Council to remit rates will necessarily be known in advance and/or provided for in specific rating policies. In circumstances where the rating policy is deemed by the Council to unfairly disadvantage an individual ratepayer, the Council may grant a one-off remission of part or all of the rates assessed for a rating unit (or property) on the condition that the remission does not set a precedent that unfairly disadvantages other ratepayers.

Policy objective

To provide for the possibility of a rates remission in circumstances that have not been specifically addressed in other parts of the Council’s Rates Remission and Postponement Policies.

Conditions and criteria

The Council may remit part of the general rate assessed in relation to particular rating unit where:

i. the rates on that rating unit are disproportionate to those levied in respect of comparable rating units, or
ii. ​the rating policy is determined by the Council to unfairly disadvantage an individual ratepayer.

The approval of the remission must not set a precedent that unfairly disadvantages other ratepayers.

2.6 REMISSION OF RATES FOR BUILDINGS REMOVED FROM THE EARTHQUAKE PRONE BUILDINGS LIST

Remission statement

The Council may grant a remission on a property’s rates where the property was on the Council’s Earthquake Prone Building List and the owner has taken action to remove that building from the list either by strengthening that building to beyond 33 percent of the New Building Standard (NBS) or by removing the building from the site. The building owner may qualify for this remission for a period of 3 years after the removal of the building from the earthquake prone building list. If the building is listed in the District Plan Heritage List then the building owner may qualify for this remission for a period of 5 years after the removal of the building from the earthquake prone building list.

The building owner must apply for this remission within 12 months of the removal of the building from the earthquake prone building list (by issuance of a code of compliance for work performed).

For strengthened buildings, the remission shall equate to the increased rates (general rate, downtown targeted rate, commercial industrial and business sector or base sector targeted rates, stormwater network and sewerage rates) payable due to the valuation uplift that may arise from seismic strengthening works.

For removed buildings, the remission shall equate to 10 percent of the rates (general rate, downtown targeted rate, commercial industrial and business sector or base sector targeted rates, stormwater network and sewerage rates) payable on the property.

Policy objective

The objective of this remission policy is to minimise the rates impact of valuation increases arising for property owners who have taken positive action to address the structural safety of their earthquake-prone buildings.

Conditions and criteria

A remission of rates may apply under the following conditions and criteria:

i. the building must have been on the Earthquake Prone Buildings list27
ii. the building owner must have taken action to remove their building from this list either through seismic strengthening or building removal
iii. the remission must be applied for within 12 months of the building being removed from the Earthquake Prone Buildings list and will relate to the following three rating years only (the property owner does not need to reapply in years 2 and 3). If the building is listed in the District Plan Heritage List then the building owner may apply for this remssion for a period of 5 years after the removal of the building from the earthquake prone building list.
iv. the remission will apply to the general rate, downtown targeted rate, commercial industrial and business sector or base sector targeted rates, stormwater network and sewerage rates (hereinafter referred to as “the rates”)
v. the remission will not be available retrospectively for buildings already removed from the list prior to this policy being implemented
vi. the remission is only available to the property owner who has taken action to remedy their building. It will not be available to a third-party purchaser of the building even if a sale took place within three years (or 5 years for a building listed on the Heritage List of the District Plan) of the building being removed from the Earthquake Prone Buildings list
​vii. for earthquake-prone buildings that have been seismically strengthened to > 33 percent NBS the following conditions and calculations will apply:
a. the remission application will be accepted after the code of compliance has been issued for the seismic strengthening project
b. the remission will be calculated as the additional rates payable due to the valuation uplift that may arise from the seismic strengthening project28
c. if there has been no property valuation uplift as a result of seismic strengthening work then no remission will be calculated
​d. the Council’s nominal annual rates increase will still apply
viii. for earthquake prone buildings that have been removed from the site the following conditions and calculations will apply:
a. the remission application will be accepted after evidence of the building removal has been provided to Council and the building has been removed from the earthquake prone building list
​b. the remission will be calculated as 10 percent of the rates payable on the property for each of the three years following the acceptance of the remission application

Valuation changes

Wellington City Council is on a three-yearly valuation cycle for all properties in the city. City-wide valuations are performed by Quotable Value New Zealand Limited in September and are used to calculate rates from the next rating year commencing 1 July. The next city-wide valuation will occur in September 2015 and will be used to calculate rates for the rating year commencing 1 July 2016.

Properties are also subject to 'maintenance valuation adjustments' at any time between the valuation cycles when there has been a measurable value change, usually triggered by improvement works.

Building owners will be notified when the capital value of their property has changed. Rates will be calculated using the new capital value from the next rating year commencing 1 July.

Application

This remission may be applied for at anytime during the year. If approved by Council officers the remission will take effect either from the next rating year (1 July), or will be backdated to take effect from the start of the current rating year at the nomination of the property owner and agreement of Council officers. The remission will cease after three years from the agreed effective start date or after 5 years in the case of a building listed in the District Plan Heritage List.

3. Applying For A Rates RemissionTop

All applications must be in writing and set out the reasons for the request using the Wellington City Council ‘Application for Remission’ form.

Each remission application is applicable to a single rating year. Applications must be received prior to the commencement of the rating year the remission is being applied for (1 July), with the exception of the Special Circumstances Remission, Voluntary Residential Metered Water Rates Remission and the Remission of rates for buildings removed from the earthquake prone building list which may be received after the start of a rating year. No applications will be backdated beyond the current rating year.

All applications for a remission on a rating unit that has previously received a remission or remissions, must be re-submitted annually for consideration of further remissions prior to the commencement of the rating year (1 July).

The determination of eligibility and approval of any remission is at the absolute discretion of the Wellington City Council or its delegated officer.

Applications made for a remission will be considered on their own merits and any previous decisions of the Council will not be regarded as creating a precedent or expectations.

4. DelegationTop

Decisions relating to the remission of rates are delegated to the Chief Executive, the Chief Financial Officer and the Manager Financial Accounting.

5. Rates Penalty RemissionTop

Policy objective

To enable the Council to act fairly and reasonably when rates have not been received by the due date and a penalty has been applied.

Conditions and criteria

Upon receipt of an application from the ratepayer, or identified by the Council, the Council may remit all or part of a penalty where it considers that it is fair and equitable to do so.

Matters that will be taken into consideration by the Council include the following:

a. the ratepayer’s payment history, and
b. the impact on the ratepayer of an extraordinary event, and
c. the payment of the full amount of rates due, or
d. ​the ratepayer entering into an agreement with the Council for the payment of rates within a reasonable timeframe.

The Council reserves the right to impose conditions on the remission of penalties.

APPLYING FOR A RATES PENALTY REMISSION

A Rates Penalty Remission application must be in writing, setting out the reasons for the request with enough information and proof for officers to evaluate the request. No special remission form is required. The written request will be accepted by post, fax or email (rates@wcc.govt.nz).

DELEGATION FOR A RATES PENALTY REMISSION

Decisions relating to the remission of penalties on rates are delegated to the Chief Executive, the Chief Financial Officer and the Manager Financial Accounting.

6. Non-Rateable LandTop

In addition to rates remissions, some types of property are not rateable or are partly non-rateable under Schedule 1 or Schedule 2 of the Local Government Rating Act (2002). For details of non rateable property uses refer to this legislation on the New Zealand Legislation website.

7. Remission Of Rates On Māori Freehold LandTop

The Council’s objectives in relation to rates remission and postponement apply equally to Māori freehold land. Therefore the rates remission and postponement policies applicable to Māori freehold land are identical to those that apply to non-Māori freehold land.

27As maintained by Wellington City Council.
28Property valuation adjustments will occur either as part of the Council’s three-yearly city wide revaluation cycle, or through ‘maintenance valuation adjustments’ that occur in between cycles where improvement works have taken place resulting in a measurable value change. Building owners will be notified of any valuation change in both circumstances. Under both circumstances rates are not impacted until the next rating year commencing 1 July. Officers reserve the right to use their discretion in determining valuation changes that may arise from seismic strengthening under this policy.