Dear Member, 

 

The statutory revaluation of all business premises in Waterford City, Waterford County and Dungarvan Town Council Areas is well in progress and we have been informed that the Proposed Valuation Certificates were  issued to hotels and guest houses dated 11th June 2013, by the Valuation Office. These Certificates indicate the new Valuations proposed by the Valuation Office in respect of the premises, which will be the basis for calculating local authority rates for five to ten years from January 2014.

 

Arising from the issue of these certificates, ratepayers have, until, 8th July 2013, a statutory right to make representations to the Valuation Office. These representations should include the ratepayer’s dissatisfaction or other reaction to the proposed valuation.

 

The Valuation Act, 2001 requires the Valuation Office to consider representations made.

 

It is of utmost importance that you are extremely vigilant in checking if the certificate has been issued in respect of your property.

 

You can check if the Proposed Valuation Certificate has been issued in respect of your property on www.valoff.ie and following the link to “Waterford City, County & Dungarvan Revaluation” then click on “Check and see if your Proposed Valuation Certificate been Issued” and enter the details requested to identify your property. You will have a PIN number shown in any recent correspondence from the Valuation Office.

We strongly advise that you go through this process today to establish the Rateable Valuation being proposed by the Valuation Office in respect of your hotel or Guesthouse. 

 

The IHF has cause for concern that the method which may have been used by the Valuation Office in arriving at the proposed valuations may not be equitable and not the method appropriate to arrive at the net annual value of hotels and guesthouses as prescribed in Section 48 of the Valuation Act, 2001. This section defines the net annual value of a property as “the rent at which the property may reasonably be expected to be let from year to year….”. 

 

Two hotels in the Fingal area successfully argued on appeal before the Valuation Tribunal that the appropriate method of calculating the relevant rent, in respect of properties such as hotels where there is no established arms-length rental market, was by applying a detailed Receipts and Expenditure (“R&E”) method of calculating the profitability of the hotels and then apportioning a portion of the profit to being the hypothetical landlord’s rent. While the Valuation Office has appealed the decisions in these cases, by means of case stated, to the High Court and the outcome of this case has yet to be finally determined, the IHF’s view is that the R&E is a more equitable method in calculating the valuation of most hotels and guesthouses. The IHF suspects that the Valuation Office in arriving at the Proposed Valuations for hotels and guesthouses in the Waterford areas may not have used this method in respect of all properties.

 

We believe that it is essential that in considering the valuations indicated in the Proposed Valuation Certificates, all hotel and guesthouse owners should, using the R&E method, calculate the appropriate valuation of their property. If the outcome of this exercise results in a valuation less than that set out in the Proposed Valuation Certificate, the ratepayer should, before 8th July 2013, make statutory representation by completing the representation form available from the Valuation Office or on line by following the instructions on www.valoff.ie (be sure to retain a copy). 

 

Rateable Valuation is a very complex and technical process and the IHF retains GVA Donal O Buachalla, an associate member, as a general advisor on Valuation issues. We strongly advise members affected by this revaluation to immediately seek professional help on the matter and should they wish to use GVA Donal O Buachalla, - Telephone number 01 676 2711  the contact person is Ms. Siobhan Murphy –Email smurphy@dob.ie.

 

Following receipt of the representations the Valuation Office must consider them in advance of issuing final Valuation Certificates before 31 December 2013. If the ratepayer is still unhappy he or she can appeal the valuations set in the Valuation Certificates to the Commissioner of Valuation and thereafter as necessary to the Valuation Tribunal.

 

The IHF strongly advises that a highly convincing case is made at the representation stage to reduce the valuations and for this reason we believe that there should be early engagement with a competent and well-informed valuation consultant who understands hotels and guesthouses and is familiar with the technical demands of the Receipts and Expenditure method.

 

To assist and inform members of the appropriate and urgent action now to be taken, The Federation has arranged aSpecial Seminar on the Revaluation Process.

 

We strongly advise that all hotels and guesthouses affected by the revaluation should be represented at the seminar. 

 

Finally as this is a matter which may have grave long term impact on both the value and profitability of hotels and guesthouses it is essential that this memo is brought to the attention of the owners and major investors in the premises.