WIRELESS BROADBAND NON-DOMESTIC RATES
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1 WIRELESS BROADBAND NON-DOMESTIC RATES Valuation Office Agency Presentation at BSG 22 April 2013 Alan Roy Bradford MRICS Dip Rating
2 VOA Who we are VOA - Valuation Office Agency Executive Agency of HMRC Provides Valuations for: Non-Domestic Rates (NDR) Council Tax Other Government Departments Deals with appeals against NDR assessments
3 Aim of this Presentation Dispel myths Promote a better understanding Engage with industry Exchange information to develop robust valuation policy and schemes of value Explain NDR and how it relates to Wireless Broadband infrastructure
4 Dispel Myths Government policy not VOA remit VOA has no discretion legislation/law NDR also called Business Rates It is not a Broadband/Fibre/Wireless Tax NDR not applied to domestic property e.g. home wireless routers The VOA does not make the value, it follows market evidence
5 Non-Domestic Rates (NDR) Primary Legislation LGFA SI Tax on the occupation of Land to fund local services Unit of Assessment - Hereditament Current Rating List 2010 Based on Values at 1 April 2008 (AVD) Revaluation 2015 postponed to 2017 VOA assesses RV Annual Rental Value Billing Authorities calculate liability - RV x UBR (reliefs/transition)
6 NDR - Hereditament Unit of assessment - physical contiguity * Has to be Non-Domestic Case Law - 4 Elements * Actual occupation Exclusive occupation Beneficial (Not only profit - social benefit) Not too transient *Subject to Empty Property Rates, Completion Notices, Central List etc.
7 NDR Telecoms Rating Telecom infrastructure is not exempt RoT - Passive infrastructure is rateable RoT - Active infrastructure is not rateable A Hereditament is Fixed to Land A Hereditament has to be Occupied * Photons, electrons, spectrum is not rateable but it may affect value of Land
8 NDR Telecoms includes Fibre optic networks (eg. Trunk and Core) Copper networks (eg. Local Access) Next Generation Access networks Wireless/Broadcast/Mobile mast sites Telephone kiosks etc. Eg. BT, VM CATV, Mobile phone masts
9 NDR Telecoms Practice Notes VOA Practice Notes on VOA website Publications\Rating Manual\Volume 5 Section 860 Mast sites (*Wireless BB?) Section 870 CATV Networks Section 871 Fibre Networks Section 873 Next Generation Access * Live documents changes as required
10 Wireless Broadband Questions What/How/Who/Where? What is Wireless Broadband? WiFi, WiMAX, LTE, NGA? Definitions? How do they fit and interact? How do they compete with fixed line? Who occupies the infrastructure? Are they Domestic or Non-Domestic? Where are they? What do they look like?
11 Wireless Broadband Valuation Questions Cost of installation (Passive and Active)? Rental payments for installation on land? Benefits in kind? (Free Broadband) Revenues from services? Funding, grants? Business plans? The more we know the better we can value
12 NDR Wireless Broadband Process Investigations involvement of operators (through BSG and/or individually) Obtain facts and evidence Analyse and check Develop Practice note Clarify Define Value Raise assessments (where appropriate)
13 NDR Wireless Broadband Problems Paramount Control who is in occupation? Domestic/Non-Domestic? Ancillary or separate use to host premises? Home Routers used as relay sites WiFi in Coffee Shops, Hotels etc Streetworks sites Mesh networks contiguity Value (Urban/Rural areas)?
14 Current VOA Policy - WiFi Domestic WiFi routers are not-rateable to NDR Domestic WiFi routers used as wireless relay sites borderline benefit of the doubt - not rateable WiFi in non-domestic premises - controlled by the Host premises occupier to enhance their occupation eg. Coffee Shops, Hotels etc value reflected in the Host assessment Other rateable non-domestic WiFi sites, including streetworks WiFi installations separately assessed Value 100 RV/WiFi site (subject to evidence and challenges)
15 Wireless Broadband NDR Policy Investigation, information gathering Involve industry/operators Define rateable/non-rateable infrastructure Analysis of evidence Produce Valuation Practice Note Stand back and look - review Publish Practice Note
16 Conclusion Current Government policy is that non-domestic telecoms infrastructure is rateable VOA has no discretion. Engagement with Wireless Broadband operators is essential to produce a robust and fair valuation scheme. VOA needs information/facts on which to base valuation policy and RVs. VOA s interpretation of rating law and valuations can be challenged on appeals.
17 Discussions and Questions I cannot comment on: The facts of individual cases Government Policy I cannot provide definitive answers without all the facts and time to consider them I can comment on: Rating principles and law Valuation principles The NDR process
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