SHIRE OF KALAMUNDA
OBJECTS OF AND REASONS FOR PROPOSED DIFFERENTIAL RATES FOR THE YEAR ENDING 30 JUNE 2010
The Shire of Kalamunda provides services to a diverse and rapidly changing region consisting of residential, commercial, industrial, rural and special rural properties. Council has adopted a differential rating approach for the 2009/2010 financial year in an attempt to ensure that the rate revenue is collected on an equitable basis, taking into consideration the levels of services provided to the different types of properties as well as the need to encourage specific types of activities within the region.
The Local Government Act stipulates that where land is used predominantly for rural purposes the rate levied shall be based on Unimproved Values (UV) of the respective properties, and where the land is used predominantly for non-rural purposes the rate levied shall be based on Gross Rental Value (GRV).
Council will implement the following differential rating categories:
General GRV
Industrial GRV
Rural UV
VALUATIONS
Landgate is the statutory authority responsible for the valuation process in accordance with the provisions of the Local Government Act 1995 and the Valuation of Land Act 1978. Landgate carries out general valuations at such times and frequency as it considers necessary. Where valuations are used as a rate base, they should reasonably reflect the current market and be supported by sales and rental evidence.
Unimproved (UV)
The definition of Unimproved Value (UV):
“Means the capital amount that an estate of fee simple in the land might reasonably be expected to realize upon sale, assuming that any improvements to the land had not been made”.
UV properties are reviewed on an annual basis, with the last review assessed as at 1 August 2008 effective 1 July 2009.
Gross Rental Valuations (GRV)
The definition of a Gross Rental Value (GRV):
“Means the gross annual rental that the land might reasonably be expected to realize if let on tenancy from year to year, upon condition that the landlord were liable for all rates, taxes, insurance, and other outgoings necessary to maintain the value of the land”.
GRV properties are reviewed every 3 years, with the last review assessed as at 1 August 2006 effective 1 July 2008. Properties on a GRV valuation are assessed as follows;
- Developed - sales and rental evidence.
- Vacant - 5% of the site value.
OBJECTIONS TO VALUATIONS
There are provisions for ratepayers to lodge an objection to valuations within 60 days of the issue of the rate notice. It is important that any objection to a valuation should be on the grounds that the valuation is unjust or incorrect and not simply based on the quantum of rates payable.
Further information and brochures on objection procedures are available from Landgate by visiting their website at www.landgate.wa.gov.au. Ratepayers are also encouraged to telephone the Office on 9429 8533 to discuss their valuation concerns prior to lodging any formal objection. Objection to Valuation forms can also be obtained by contacting the Shire’s Rates Department on 9257 9999 or e-mail rates@kalamunda.wa.gov.au.
RATING YIELD OBJECTIVE
In setting the rate in the dollar for each category, Council has taken into consideration the following factors:
Rates revenue will continue to be the main source of revenue for the Shire.
The Shire’s officers will endeavour to access more grant funding for approved projects, but it is to be recognised that there is increasing competition for a reducing pool. A large portion of the fees and charges for the services provided by the Shire are set by Statutory Regulations, and other fees are price sensitive. Thus the potential for increased revenue from other sources than rates is limited.
The Shire has under its management approximately 600 kilometres of roads and over 220 buildings. A large percentage of these are approaching, if not already passed, the stage where they need substantial repairs and maintenance. As with many local governments in Western Australia, infrastructure assets are in urgent need of care if they are to be effectively utilized over their planned lifespan.
DIFFERENTIAL RATES
Category 1 - General GRV
The General GRV applies to properties zoned residential, special use, urban development, commercial and mixed use under the Local Planning Scheme. The Shire of Kalamunda’s rates historically are lower than our immediate neighbours and many other metropolitan councils.
Rate in the dollar is 6.4990 cents with a minimum of $549.85.
Category 2 – Industrial GRV
The Industrial rate is levied on properties zoned Industry and Light Industry under the Local Planning Scheme. Industrial rates are applied in accordance with the scheme together with the Fire and Emergency Services Levy (FESA) which distinguishes between industrial and commercial property uses. It is noted that rate levies paid by industrial property owners are generally tax deductible.
Rate in the dollar is 6.7580 cents with a minimum of $571.85.
Category 3 - Rural UV
This category is applied to all rural properties which do not fall into one of the other categories, and is the base for computing the rate in the dollar for Unimproved Value properties. The valuations of UV properties are reviewed on an annual basis by Landgate.
Rate in the dollar is 0.2417 cents with a minimum of $549.85.
Summary
In arriving at the proposed rates in the dollar the Council has attempted to balance the need for revenue to fund essential services and facilities with the desire to limit any increase on the ratepayer to affordable levels.
Submissions, addressed to the Chief Executive Officer, Shire of Kalamunda, PO Box 42 Kalamunda WA 6926, by electors or ratepayers in respect of the proposed Differential Rates and Minimum Payments, may be lodged to Council by 5.00 pm on Tuesday 21 July 2009.