Part G: Policies and Strategies

Rates Remission Policy

Introduction

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 109 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.

Circumstances where a remission may applyTop

Rural open space remission

Remission statement

The Council may grant a 50 percent remission of Base general rate 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 purpose

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:

i. the rating unit (or property) exceeds 30 hectares in area; and

ii. 50 percent or more of the rateable capital value of the property is made up of the land value; and

iii. 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.

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 Base general rate where the rating unit:

i. has a club licence under the Sale and Supply of Alcohol Act 2012; and

ii. would otherwise qualify as 50 percent non-rateable under Part 2, Schedule 1, of the Local Government (Rating) Act 2002; and

iii. 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 licence and no longer qualify as 50 percent non-rateable.

Conditions and criteria

This policy specifically excludes chartered clubs and clubs holding permanent charters.

Remission of targeted rates on property under development or earthquake strengthening

Remission statement

The Council may remit part or all of the commercial sector targeted rate, Business Improvement District targeted rate and downtown targeted rate 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:

i. the property (rating unit) will not hold sufficient consents to permit occupation; and

ii. 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

iii. 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’.

Remission of metered water rates

Remission statement

The Council may grant a remission on a water targeted rate (with water meter) 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 property with a water meter, and prompt remedial action to repair the leak has been undertaken. The ratepayer remains 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 water targeted rate (with a meter) 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 prior to the leak. 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. Where sufficient information is not available on historic readings, excess water consumption will be calculated as the difference between the latest reading prior to the fault being remedied, and the average daily metered usage over the last three monthly readings after the fault is remedied. This remission should only be applied for if:

i. the leak occurred on a 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 event of a recurrence of a water leak, Council would require the ratepayer to get a condition assessment of the pipes on the property prior to any decisions to remit a subsequent remission.

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 ratepayer has taken action to remove that building from the list (either by strengthening that building to above 33 percent of the New Building Standard (NBS) or by removing the building from the site).

The ratepayer may qualify for this remission for a period of rating years after the removal of the building from the Earthquake Prone Building list54, or up until the building is sold (whichever comes first).

The terms of remission that apply are as follows:

a. a remission period of 3 years for all buildings (not applicable to the heritage remissions below) that are removed from the earthquake prone list; or

b. a remission period of 5 years for all buildings removed from the earthquake prone list that are listed on the Wellington City District Plan Heritage List; or

c. a remission period of 10 years for all buildings as per (b) and are identified by Heritage New Zealand as Category I on the New Zealand Heritage list; or

d. a remission period of 8 years for all buildings as per (b) and are identified by Heritage New Zealand as Category II on the New Zealand Heritage list.

The ratepayer 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 earthquake-prone buildings that have been seismically strengthened to > 33 percent NBS the following will apply:

a. the remission application will be accepted after the code of compliance has been issued for the building following completion of the seismic strengthening project;

b. the remission shall equate to the rates (general rate, downtown targeted rate, commercial industrial and business sector or base sector targeted rates, stormwater network and sewerage rates) payable due to any rating valuation uplift55 that may arise from seismic strengthening works; if there has been no rating valuation uplift on the property as a result of seismic strengthening work then no remission will apply.

The valuation uplift from seismic strengthening works will be calculated as:

Final Improvement Value $ per m2(A)
 

-
Initial Improvement Value $ per m2(B)
x
Initial floor area of earthquake prone building(C)

A = This is the total improvement value portion of the revaluation of the whole rating unit (after issuance of the code of compliance and after removal of building from the Earthquake Prone Building List) divided by the floor area at the time of issuance of the code of compliance, after removal of the building from the Earthquake Prone Building List.

B = This is the total improvement value portion of the rateable value of the earthquake prone building at the time the building consent for earthquake strengthening work is approved, divided by the floor area of the earthquake prone building at the time the building consent for earthquake strengthening work is approved.

C = This is the floor area of the earthquake prone building at the time the building consent for earthquake strengthening work is approved.

The valuation uplift amount that has been calculated using the above methodology will be used to calculate the rates remission for the duration of the remission. The valuation uplift amount will not be re-calculated to take into account any future changes to the building’s valuation post the first valuation assessment carried out after removal from the Earthquake Prone Building List (by issuance of a code of compliance). For clarity, changes in land value are excluded from the above calculations and any remission calculation.

For earthquake prone buildings that have been removed from the site the following 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; and

b. the remission will be calculated as 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, on the valuation post removal of the earthquake-prone building from the site, for each of the three years following the acceptance of the remission application.

Policy objective

The objective of this remission policy is to minimise the rates impact of valuation increases arising for ratepayers who have taken positive action to address the structural safety of their earthquake-prone buildings, or remove their unsafe 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 list;56

ii. the ratepayer 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 specified number of rating years only (the ratepayer does not need to re-apply in subsequent years). The terms of remission that apply are as follows:

a. for all buildings (not applicable to the heritage remissions below) that are removed from the earthquake prone list, the ratepayer may apply for this remission for a total period of 3 years; or

b. for all buildings removed from the Earthquake Prone Building List that are listed on the Wellington City District Plan Heritage List, the ratepayer may apply for this remission for a total period of 5 years after the removal of the building from the Earthquake Prone Building List; or

c. for all buildings as per (b) and are identified by Heritage New Zealand as Category I on the New Zealand Heritage list, the ratepayer may apply for this remission for a total period of 10 years after the removal of the building from the Earthquake Prone Building List; or

d. for all buildings as per (b) and are identified by Heritage New Zealand as Category II on the New Zealand Heritage list, the ratepayer may apply for this remission for a total period of 8 years after the removal of the building from the Earthquake Prone Building List.

iv. the remission will not be available retrospectively for buildings already removed from the Earthquake Prone Building List prior to this policy being implemented;

v. the remission is only available to a ratepayer 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 the remission period applicable to that building being removed from the Earthquake Prone Buildings list; and

vi. for earthquake prone buildings that have been removed from the site, evidence must be provided to Council of the building removal and the building must have been removed from the Earthquake Prone Building List.

Valuation changes

Wellington City Council is currently on a three-yearly valuation cycle for all properties in the city. The next city-wide valuation will occur as at 1 September 2018 and will be used to calculate rates for the next three rating years commencing 1 July 2019.

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

Ratepayers 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 any time 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 ratepayer and agreement of Council officers. The remission will cease after the specified number of years from the agreed effective start date, or up until the building is sold (whichever comes first).

Remission for natural disasters and emergencies

Remission statement

In order to provide relief to ratepayers where a natural disaster or other type of emergency affects one or more rating unit’s capacity to be inhabited, used or otherwise occupied for an extended period of time, Council may remit all or part of any rate or charge where it considers it fair to do so, based on the criteria below. Individual events causing a disaster or emergency are to be identified by Council resolution. Council may develop further guidance as to how it implements the criteria below at that time depending on the nature and severity of the event and available funding at the time. Council will exercise its discretion depending on the nature and severity of the event. Note that Greater Wellington Regional Council rates will still apply.

Policy objective

The objective of this remission policy is to provide a measure of rates relief where a natural disaster or other type of emergency affects one or more rating units’ capacity to be inhabited, used or otherwise occupied for an extended period of time.

Conditions and criteria

The Council may remit all or part of any rate or charge assessed in relation to a particular rating unit where:

i. a natural disaster or other type of emergency has affected its capacity to be inhabited, used or otherwise occupied for an extended period of time

ii. Council considers it fair to do so and has identified the individual event causing a disaster or emergency through Council resolution

iii. it meets any further guidance provided by Council as to how Council will implement the above criteria for the particular event, depending on the nature and severity of the event and available funding at the time

Remission for new residential greenfield developments

Remission statement

The Council may grant a remission on a new residential greenfield development of 30 or more allotments (or dwellings where it is proposed that the dwellings will be unit-titled) in the following Special Housing Areas:

The ratepayer may qualify for this remission for a period of 2 years after a section 224(c) certificate and new titles are issued, or until the allotment or title is sold (whichever comes first).

The remission shall equate to the approximate increase in rates (general rate, Base sector targeted rate, and stormwater network rate) payable due to the increase in land value that may arise from a residential greenfield subdivision.

The remission may be applied for once a section 224(c) certificate and new titles have been issued, and only within the duration of the Housing Accord which ends on 30 June 2019. The remission will apply for two rating years and the ratepayer does not need to reapply in year two.

The remission will be calculated on the uplift in rates from subdividing greenfield land into residential lots. The amount is calculated as the land value of each allotment (after title is issued) less the equivalent land value for the allotment before subdivision. The ‘equivalent’ value before subdivision is calculated as $20 per m2 multiplied by the allotment area.

Policy objective

The objective of this remission policy is to minimise the rates impact of valuation increases arising for developers from new residential greenfield developments in the Special Housing Areas, to promote the supply of land for housing.

Conditions and criteria

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

i. the new residential development must be within the following Special Housing Areas57

a. Lower Stebbings

b. Lincolnshire-Woodridge

c. 30 White Pine Avenue, Woodridge

d. The Reedy Land, 28 Westchester Drive, Glenside

ii. the development must be of 30 or more allotments (or dwellings where it is proposed that the dwellings will be unit titled)

iii. the remission must be applied for within the duration of the Housing Accord. No application will be eligible for this remission after 30 June 2019

iv. the remission will apply to the general rate, Base sector targeted rate, and stormwater network rates

v. the remission will not be available retrospectively for residential greenfield developments that are already completed

vi. the remission will apply for a maximum of two years; commencing when the new allotment titles are issued and ending two years later, or when the new allotment or title is sold (whichever comes first)

Remission for first home builders

Remission statement

The Council may grant a rate remission on a new residential dwelling (including apartments) on a separate rating unit, where construction is completed after 01 July 2017 within the boundaries of Wellington City Council.

The remission will be up to a maximum of $5,000 (including GST). To qualify for this remission, the applicant must meet the following criteria:

The earliest the remission can be applied for is after a building code compliance certificate has been issued by the Council for the rating unit. The remission will end once the $5,000 (including GST) has been remitted or when the rating unit is sold (whichever comes first).

The remission shall apply to all Wellington City Council rates assessed on the rating unit. Note that Greater Wellington Regional Council rates will still apply.

Applications must be received prior to the commencement of the rating year the remission is being applied for (1 July).

Policy objective

The objective of this remission policy is to assist new first home builders and promote the supply of housing in Wellington city.

Conditions and criteria

A remission of rates may apply if all of the following conditions and criteria are met:

i.the new residential dwelling must be within the Wellington City Council district;

ii.the new residential dwelling must be on a separate rating unit;

iii.the ratepayer must be a New Zealand permanent resident or citizen and provide evidence of this;

iv. the property must be the first residential dwelling owned by the applicant;

v. the property must be a new residential dwelling (including apartments);

vi. the ratepayer uses the property as their primary residential dwelling;

vii.the property must be either built for the first owner or purchased within six months of construction;

viii.the ratepayer must provide evidence that they own the property;

ix. application can be made by the ratepayer after a building code compliance certificate has been issued by the Council for the rating unit;

x. the remission will not be available retrospectively for residential dwellings (including apartments) that are already completed before 1 July 2017;

xi. once granted, the remission will apply for a set period; commencing from the start of the following rating year and ending when the total amount of Wellington City Council rates remitted on the property reaches the $5,000 (including GST) limit or when the rating unit is sold (whichever comes first); and

xii. trusts, businesses and companies are not eligible for the remission.

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 Wellington City Council rates assessed for a rating unit. Note that Greater Wellington Regional Council rates will still apply.

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 or all of the rates assessed in relation to a particular rating unit where:

i. the rates on that rating unit are disproportionate to those assessed 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 does not set a precedent that application of the usual rates unfairly disadvantages other ratepayers.

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, except the Remission of Rates for Buildings Removed from the Earthquake Prone Buildings List, the Remission for New Greenfield Developments and the Remission for First Home Builders, which may apply to multiple rating years.

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 following remission applications which may be received after the start of a rating year:

i. the Special Circumstances Remission;

ii. the Metered Water Rates Remission;

iii. the Remission of Rates for Buildings removed from the Earthquake Prone Buildings List and

iv. the Remission for New Greenfield Developments.

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), with the exception of the Remission of Rates for Buildings removed from the Earthquake Prone Buildings List, the Remission for New Greenfield Developments and the Remission for First Home Builders.

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

If Council is satisfied that the relevant criteria in the policy are met, it will give the applicant ratepayer notice of the remitted rates.

Applications made for a remission will be considered on their own merits on a case-by-case basis. Any previous decisions of the Council do not create a precedent.

Approval of a remission does not set a precedent that application of the usual rates unfairly disadvantages other ratepayers.

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 as 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:

i. this is the first time a penalty is applied during a prior three year period and either:

a. the payment of the full amount of rates due within 14 days of due date; or

b. the ratepayer enters into a suitable agreement with the Council for the payment of rates within a reasonable timeframe; or

ii. there was an extraordinary event leading to the late payment of the instalment and either:

a. the payment of the full amount of rates due within 14 days of due date; or

b. the ratepayer enters into a suitable agreement with the Council for the payment of rates within a reasonable timeframe; or

iii. the ratepayer has agreed to pay future rates by direct debit.

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).

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 and the Council’s website.

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.

54As maintained by Wellington City Council
55Rating valuation adjustments will occur either as part of the Council’s three-yearly city wide revaluation cycle, or through adjustments that occur in between cycles where improvement works have taken place resulting in a measurable value change. Ratepayers 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, and relate to, seismic strengthening under this policy.
56As maintained by Wellington City Council
57As defined by the legislative instrument ‘Housing Accords and Special Housing Areas (Wellington) Order 2014’