Simon Harris (Wicklow, Fine Gael) | Oireachtas source

We have discussed at length the issues to which the amendment refers. Given that the overriding principle of rates is the occupation of the physical structure being valued, not the economic buoyancy or otherwise of the business carried out in it, I cannot accept the Deputy's amendment. However, I am pleased he has raised the issue of wind energy, given that on Committee Stage I made a commitment to revert to it on Report Stage, and I welcome the opportunity to do so.

The large increase in rates for wind farms, arising from the revaluation of all commercial property in Limerick, and the implications of this level of increase for the wind energy sector, were discussed on Committee Stage. While I accept the wind energy sector is not seeking a complete exemption from rates, it was hoping to propose amendments to the Bill. There were no related amendments on Committee Stage and there are none on Report Stage. However, I undertook to consider this and my officials have engaged with interested stakeholders on the issue. The points I made during the debate on Committee Stage still hold true and, for the benefit of the House, I will summarise what I said.

Like all revaluations, the Limerick revaluation redistributed the rates burden based on contemporary property values. A revaluation can cause significant shifts in rates liabilities between different sectors, particularly where a considerable period has elapsed since the last exercise. We want this process to ensure more regular revaluations. From experience of revaluations to date, up to 65% of ratepayers can experience a reduction in their rates. Given that the total revenue from rates is capped after a revaluation, the reductions enjoyed by the 65% will result in increases for the other 35%. The Limerick revaluation has led to large increases in the valuations of wind farms which will, subject to appeal, see their rates rise in some cases by 200%.

The increases experienced by wind farms as a category of rateable property are on the higher end of the scale across the board. In recent revaluations, some individual properties in certain categories have also experienced very significant rate increases. Limerick is the first revalued rating authority with a significant number of wind farms. The ten Limerick wind farms which have recently been revalued are modern, have large generating capacities and date from approximately 2008 onwards. They comprise some of the latest technology in a rapidly developing area. This contrasts with the position heretofore. The first wind farm valued by the Valuation Office for the purposes of rating was developed in the early 1990s in County Mayo. The valuation assessed on this first wind farm set the basis for valuing all other wind farms that subsequently came on stream, including the Limerick wind farms before they were revalued.

All the wind farms were valued under the revision provisions of the current legislation. This reflected the state of wind energy technology in the early 1990s and the financial and economic conditions that prevailed in Ireland in the late 1980s. The valuations now assessed on the wind farms in Limerick, like all other rateable properties in Limerick, reflect the economic conditions which prevailed in late 2012.

The Commissioner of Valuation is independent in the exercise of his function and the Valuation Act does not accord the Minister any function in the valuation of a property or an appeal. However, the legislation provides for a number of avenues of appeal. There is an appeal to the Commissioner of Valuation, a subsequent appeal to the Valuation Tribunal and an appeal to the High Court on a point of law. It is important to allow for the independent process of valuation and appeal to take its course without knee-jerk policy reactions before it concludes.

Although I hear the Deputy's point on the potential delaying of the Bill, I do not accept it. I am not saying the sector does not have an issue, and I acknowledge its willingness to pay rates, even increased rates. However, the situation and the impact on the sector cannot be fully analysed until the results of the appeals process have been concluded. Delaying the Bill to allow a full analysis of the impact of current legislation, not the impact of the Bill, on one sector is not an option. The main purpose of the Bill is to introduce measures to accelerate the revaluation programme throughout the country. It would not be fair to ask ratepayers in counties that have yet to be revalued to delay the introduction of measures to accelerate the revaluation process while we consider at length the implications of the current legislation on one sector. However, a decision not to delay the Bill does not mean, nor should it be interpreted as, closing the door on a partial exemption. If, after full consideration of the facts, we decide that this is the best route to take, another legislative vehicle can be found to introduce a change to the Valuation Act 2001, if this is what is most appropriate.

We should allow the appeals process to take its course. A number of appeals are under active consideration. Let us see what arises from them and fully assess the impact. If there is a need for a policy change, let us consider it. As Minister with responsibility for the legislation, I need the revaluation process to get under way. The Deputy has rightly made the point that it is going too slowly. Ratepayers have a right to have appropriate valuations attached to their properties that reflect modern reality. A number of people would benefit from the Bill, including local sports clubs and elements of the child care sector. I want to push on with the Bill. I am not closing the door to a partial exemption and we will allow the appeals process to run its course and see where we stand from a policy point of view.

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