Rating Policy
Valuation of Land (s.6.28)
February 2015
Rating Policy: Valuation of Land – Page 1 of 7
Contents
Objective ........................................................................................................................ 3
Legislative Provision – Local Government Act 1995 ...................................................... 3
6.28.
Basis of rates ............................................................................................ 3
Principles ........................................................................................................................ 4
Application of principles to this determination ................................................................ 4
Objectivity .............................................................................................................. 5
Fairness and equity ............................................................................................... 5
Consistency ........................................................................................................... 5
Transparency ........................................................................................................ 6
Administrative efficiency ........................................................................................ 6
Information to be provided with the request for a determination ..................................... 6
Submissions .......................................................................................................... 7
For more information please contact: .................................................................... 7
Rating Policy – Valuation of Land (February 2015)
Prepared by:
Department of Local Government and Communities
140 William Street, Perth WA 6000, GPO Box R1250, PERTH WA 6844
Tel: (08) 6551 8700 Fax: (08) 6558 1555
Freecall: 1800 620 511 (Country Only)
Email: legislation@dlgc.wa.gov.au Web: www.dlgc.wa.gov.au
Translating and Interpreting Service (TIS) - Tel: 13 14 50
All or part of this document may be copied. Due recognition of source would be
appreciated. If you would like more information please contact the Department of Local
Government and Communities.
Rating Policy: Valuation of Land – Page 2 of 7
Objective
This policy aims to provide guidance underpinning the Ministerial determination on the
method of valuation of land for rating purposes.
Legislative Provision – Local Government Act 1995
6.28.
Basis of rates
(1)
The Minister is to:
(a) determine the method of valuation of land to be used by a local
government as the basis for a rate; and
(b) publish a notice of the determination in the Government Gazette.
(2)
In determining the method of valuation of land to be used by a local
government the Minister is to have regard to the general principle that the
basis for a rate on any land is to be:
(a) where the land is used predominantly for rural purposes, the
unimproved value of the land; and
(b) where the land is used predominantly for non-rural purposes, the
gross rental value of the land.
(3)
The unimproved value or gross rental value, as the case requires, of
rateable land in the district of a local government is to be recorded in the
rate record of that local government.
(4)
Subject to subsection (5), for the purposes of this section the valuation to
be used by a local government is to be the valuation in force under the
Valuation of Land Act 1978 as at 1 July in each financial year.
(5)
Where during a financial year:
(a) an interim valuation is made under the Valuation of Land Act 1978; or
(b) a valuation comes into force under the Valuation of Land Act 1978 as
a result of the amendment of a valuation under that Act; or
Rating Policy: Valuation of Land – Page 3 of 7
(c) a new valuation is made under the Valuation of Land Act 1978 in the
course of completing a general valuation that has previously come into
force,
the interim valuation, amended valuation or new valuation, as the case
requires, is to be used by a local government for the purposes of this
section.
Principles
In making the decision, the following principles will be observed:

Objectivity,

Fairness and equity,

Consistency,

Transparency, and

Administrative efficiency.
Application of principles to this determination
The fundamental decision to be made by the Minister is whether the land is used
predominantly for rural or non-rural purposes.
Changes to the method of valuing land may have significant impacts on ratepayers and
a local government’s rates revenue. Accordingly, the council should consider any
proposal for change before it is presented to the Minister for decision. If the change in
valuation method results from a recent subdivision approval, further council
consideration is not necessary.
The following matters will be taken into consideration in making a determination under
Section 6.28 to change the rating on a portion of land from Unimproved Value (UV) to
Gross Rental Value (GRV) or from GRV to UV:
Rating Policy: Valuation of Land – Page 4 of 7
Objectivity

What has prompted the need for a change in method? Has there been a
subdivision or planning application for a non-rural use or has a property
inspection or land use survey revealed that the predominant use of the land
is now non-rural, for example?

On what basis has the predominant use been determined?

How much of this portion of land is being used for a non-rural use? Are there
current plans for more of the land to be converted to non-rural uses? If so,
what is the timeframe for this change and what steps have been taken for
this conversion? (An application to change the method of valuation should
not be made until the predominant use of the land has actually occurred or
substantially commenced.)

Has the Valuer General’s Office been contacted to obtain an indication of the
notional values for use in modelling the effect of the changes for the
ratepayers and local government?
Fairness and equity

If this has not been initiated by the landowners, have they been given
adequate opportunity to comment? Have they been individually contacted?
Have they been informed of the reasons for seeking the change in method of
valuation and been given an indication of the overall likely impact of the
changes?

What regard has been had to their feedback?
Consistency

Are other properties used for similar purposes being rated in the same way?
If not, why not?

If a significant proportion of the land is likely to continue as rural use, could
the portion of land for change of valuation method be specified differently?
That is, is a split valuation appropriate?
Rating Policy: Valuation of Land – Page 5 of 7

Is the proposed method of rating of this land consistent with the rating of
equivalent land use in other local government areas?
Transparency

Has there been an opportunity for landowners to comment on the proposed
change?

Are the systems and procedures for determining the method of valuation
clearly documented and available for the public to inspect?

Has the council considered the impact of the change in valuation method?
If not, why?
Administrative efficiency

Is this the most efficient way to raise the required rates revenue?

Has consideration been given to phasing in significant changes?
Information to be provided with the request for a
determination
It is expected that the above matters will be covered in an application to the Minister for
determination. In particular, the following should be included:

Accurate and clear description of the affected land (Certificate of title details,
lot or location numbers and location names and street names, plans),

Assessment of predominant use,

Information on the likely impact on the rate assessments on the affected land
in comparison with the quantum of last year’s rates,

If this is not owner initiated, details on consultation that has occurred, a copy
of any objections that have been received and the council’s response to
these – include a copy of the letter to landowners, and

The date the changes are proposed to take effect (this cannot be
retrospective), and
Rating Policy: Valuation of Land – Page 6 of 7

A copy of the officer’s report to council, relevant Council minutes and Council
resolution (where applicable).
Local Government Operational Guidelines – Number 2: Changing Methods of Valuation
of Land provides more detailed explanations and case studies.
Submissions
Please send your completed application form and relevant attachments to:
Executive Director
Sector Regulation and Support
Department of Local Government and Communities
GPO Box R1250, PERTH WA 6844
or
Email: legislation@dlgc.wa.gov.au
For more information please contact:
Department of Local Government and Communities
Gordon Stephenson House, 140 William Street, Perth WA 6000
GPO Box R1250, Perth WA 6844
Telephone: (08) 6551 8700 Fax: (08) 6552 1555
Freecall: 1800 620 511 (Country only)
Email: legislation@dlgc.wa.gov.au Website: www.dlgc.wa.gov.au
Translating and Interpreting Service (TIS) – Tel: 13 14 50
Rating Policy: Valuation of Land – Page 7 of 7