NEW RATING

Dominion, Volume 21, Issue 189, 12 May 1928, Page 7

NEW RATING

WILL CHANGE IN SYSTEM MEAN MORE TO PAY? •FRESH VALUATION NEXT YEAR (By It has already been announced that the rates for the current financial year (1928-29) are to remain unchanged, with the exception of the hospital and charitable aid rate, which actually has nothing to do with the City Council, but is merely collected by that body and passed over to the Hospital Board in periodic payments. This hospital and charitable aid rate promises to be a considerable burden upon property owners for some time to come, as the work of reconstructing the general hospital has only just been initiated by the erection of the great administration anti outpatients block in Revans Street. With this block in operation the board will sooner or later make preparation tor the gradual reconstruction on an entirely different lay-out of th? old hospital, which was not built on a good plin in its relation to sunlight and fresh air. The cost of that long-mooted scheme will no doubt be spread over several years, but whether it is, or is not, the burden will ultimately fall upon the ratepayers. „ . „ , When the Mayor (Mr. G. A. Troup) said that it was not the intention of the council to increase the rates this year, he really meant that the council intended to live within its means according to the money yielded on the basis of last year’s rates; but actually there is a very important change being made in the incidence of rating this year, which may mean an increase to some and a decrease to others. ... It all depends. Hitherto the only rates struck on the basis of the annual value were those for water, hospital and charitable aid, and street lighting, but the result of last April’s poll not only established the fact that the people believed in that system of rating, but even in its extension to include the whole of the rates. The voting was as follows: — For rating on annual value »16J Against rating on annual value .. 4ZOZ Informal ••••: No change is being made in the amounts payable by way of rates (barring that for hospital and charitable aid), except that wrought by the change trom the unimproved to the annual value system. The assessment is being, made on the basis of values made at the last valuation in 1921, but next year there will be a new valuation; and as a new valuation in Wellington usually means an increase, judging by past experiences, there is every prospect of there being more rates to pay for the year 1929-30 than for the present financial year, inis valuation is now being made by the Valuation Department. _ There is this to be said for the annual idea: that whatever is done in the way of improvement, if such improvement brings in a better return to the owner, the City Council benefits; that is to say, a great deal more is collectable through the rates from a six-story building than for a two-story one in the same street, whereas under the system hitherto in vogue in Wellington the only. means .ot increasing rates was by the appreciation of the value of the land on which the building stands, which under the system of revaluation every five or six years, is rendered a rather jerky process. Assuming that, for some set of reasons or other, the city receives a set-back, or just marks time, valuations could not be increased —indeed, they might have to be reduced —when such would be at once reflected in the revenue of the council. In the case of the annual value the reflection or response to changed conditions is quicker. If a person owns a six-story building and only manages to let two or three of the flats, he cannot be rated on the assumption that the whole of his building is earning revenue; he must be rated according to its return, which return reacts on the capital value —the real basis of the annual value system of rating. There are arguments in favour and against both systems, yet, in effect, there may not be very great differences in what property-owners have to pay. As there is a good deal of readjustment work to be done, owing to the change noted, the rate collector’s department has its hands full, and the demands will not be issued until July.