The Provisions Covering Rating Authority Valuations under the Valuation of Land Act 1960

Overview

A general valuation includes all rateable land in a municipality (Section 154 Local Government Act 1989), and is made in accordance with the provisions of the Valuation of Land Act 1960 (VLA). For each separate occupancy of rateable land, three valuations are to be assessed, net annual value (NAV), capital improved value (CIV) and site value. VLA sections 6(4) and 13DC(1) (SV).

SV is used by the State Government to assess Land Tax, whilst municipal councils have the choice of using any one of the three valuation bases for rating purposes (Section 157 Local Government Act 1989). In the 2006/7 rating year, 74 councils used CIV, 5 NAV and 1 used SV.

The purpose of a general valuation is to provide an equitable means of apportioning the rating or property tax requirements of a municipality or taxing authority across its rate/tax payer base.

Frequency of Valuations

General valuations of all councils throughout the State are required to be returned on a biennial cycle i.e. every 2 years, however Councils have the right to undertake annual valuations if they so decide.

Every Council must carry out a valuation of rateable land within its municipal district and this valuation must be made as at 1 January in every even calendar year and returned to council before 30 June in that year (VLA s13DC(3)).

Prior to 2000, the City of Melbourne had been undertaking annual revaluations since 1994.

Use of Council Valuations by Other Authorities

General revaluations are carried out by the 80 municipal Councils and can be used by other rating authorities such as the State Revenue Office and the various Water Authorities, with the SRO contributing towards the cost of producing a Council’s revaluation.

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Section 13DC(5) of the VLA provides that the valuer must have regard to every circumstance affecting the land at the date of return. The return of the revaluation is its completion by the council valuer including the provision of values and all required data to council. The circumstances are described as those listed in S13DF which would cause a supplementary valuation were they to occur or come into existence subsequent to the revaluation return to council (completion).

Regulation 7 of the Valuation of Land (General and Supplementary Valuation) Regulations 2003 (Regulations) prescribes Form 3 of Schedule 1 of the Regulations in which the valuation return is to be made as required by S13DH(1) of the VLA.

Valuers Report to the Valuer-General

Within two (2) months of the date of returning the valuation to the council, the Valuer is required to submit a report to the Valuer-General (VLA S7(2A)).

This report must be in the form prescribed in the Regulations – Schedule 1 Forms 2 and 3

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If the Valuer-General believes the valuation to be generally true and correct as to all of the bases of value assessed, he certifies to this effect to the minister.

The Minister then declares the valuation to be suitable for adoption and use by any rating authority for the full period allowed by the law (VLA section 7(4)).

If the Valuer-General believes that there are parts of the general valuation which are not true and correct and that it would be practicable to amend them to make the whole valuation true and correct, he will conduct discussions with the valuer with a view to having the necessary amendments made.

If agreement can be reached, the valuer will make and return amending valuations, which become part of the general valuation already returned. The Valuer-General will then recommend to the Minister that a generally true and correct certificate be issued.

If agreement cannot be reached, the valuer would return those amending valuations, which he is prepared to make. The Valuer General must then decide whether he is prepared to recommend that a certificate be issued or whether he will report to the Minister that he believes the general valuation to be not generally true and correct “as to any one or more of the bases of value assessed” (VLA section 7(2B)).

If the Valuer-General is of the opinion that it would not be practicable for amending valuations to be carried out as a means of making the general valuation generally true and correct, he is required to report this opinion to the Minister.

The Minister must then determine the relative merits of requiring a new valuation to be made forthwith, or limiting the use of the valuation by the council (and any other rating authority using it) to a specified period less than the normal life of the valuation (VLA section 7(3)).