Land valuation and how will it effect my rates?

Land valuation happens every 3 years, new land values apply for the 2005/06 rating year.

Rates are principally calculated by multiplying the land value of a property by a rate-in-the-$, subject to a minimum rate payable.

In any year when new valuations apply to a local government area, the rate-in-the-$ comes down proportionately to the increase in land values across the whole of the area. For example, the rate-in-the-$ on Residential properties in the suburban areas in 2005/06 has been reduced by 64.37% over 2004/05.

All councils in NSW are restricted by legislation, called rate pegging, as to the amount of increase in total rate income that can be applied each year. The increase approved by the State Government for 2005/06 is 3.5%.

The increase in valuations for the Parramatta Local Government area for 2005/06 rating year was 51.7%. Broken down to the rating categories, the average increases are:

Residential Suburban 56.8%

Residential CBD 35.0%

Business General 38.6%

Business CBD 34.8%

Business Industrial 25.4%

The new Land Value that applies to any individual property may vary, and in many instances significantly, from the average land value increase across the local government area. This is the reason for rates to increase by larger, or smaller, amounts than the 3.5% determined by the government. This happens every time a new valuation is applied to a Council area.

For example, in 2005/06, the total land values for all residential properties in the suburban areas of Parramatta increased by 56.8%. The Table below shows the increases in Land Values, Rates and Domestic Waste Management charges by percentage for a sample of properties.

It can be seen that valuation increases of less than the average for the whole of the residential properties (56.8%) has resulted in a decrease in rates. While increases above the average for the category has varied increases according to the movement in the Land Value given to the individual property. Similar affects occur for all the other rating categories.

In Parramatta Local Government area the rates levied consist of the following rate types:

Ordinary Rate for Residential, Business, Business CBD and Industrial – ad valorem (rate-in-the-$) subject to a minimum.

Special Rates for Open Space Acquisition and Embellishment – part ad valorem (rate-in-the-$) and part base amount (fixed amount)

Special Rates for Suburban Infrastructure – part ad valorem (rate-in-the-$) and part base amount (fixed amount)

Special Rates for CBD Infrastructure – ad valorem (rate-in-the-$)

Special Rates for Economic Development in the Parramatta Primary Centre – ad valorem (rate-in-the-$)

Annual Charges for Waste Management services – (i.e. Domestic Waste Management, Commercial Waste Management and Recycling)