LOSS IN RATES TOO BOROUGH

Hawke's Bay Herald-Tribune, Issue 204, 14 September 1937, Page 4

LOSS IN RATES TOO BOROUGH

Increase In Govefnincttt Property LAND FOR H0USES The increase in Crown propertYj brought about by the acqUisition oi blocks of land for Government hOUSes, is causing some conccrn to the Hastings Borough CounCil, and it is noW anticipated that the councii Will lose a considerable sum in rates during tho year as tho result of tho Housing DepaHmeut's operations. Tho whole position of Crown liability for rates, and in particular the ratiug position "of tho liouses shortly to bo built by tho Government Housing Department, was the subject Of a special report to tho councii by the Town Clerk, Mr Noel C. Harding, and he points out that it is practically certain that the Crown will pay the rates only provided the money, by way of rentals, is paid / in full by the occupiers. In the event of any occupier being in arrears thon it is likely that the Crown will pay only a percentage of the rates in proportion to the revenue received on the property. Mr Harding pointed out that Crown buildings occupied "by Varidua departinents were totally exempt from rates, and Crown premiseS occupied by Government cinployces, who are required to / occupy them, are also exempt from rates though the Crown will pay for certain types 6f borough eervices. The Crown liability on properties mortgaged occurs only in the event of the mortgagor not paying the ratoe. The Crown in the event of the local authority claiming from it is only liable for special rates on loans which were ralsed prior to the Crown registering iti mortgage. ' .••Unfair to Local Authority/ • "This position is unfair to tho local authority/' commented Mr Harding, "because in *iany's cases . mortgagors have paid rates for a. number of years quite regularly;, and tfibn through loss of work or depressed economic conditions may find themselves unablo to 4 rneet this payment. The Crown then will pay only special rates on loans raised prior to its mortgage, even though there may be a long period between the date of the registration of the Crown mortgage and the date of the failure 0f the mortgagor to pay. During that period, of course, a number of loans rnight have been raised, but the Crown would pay no special rates for those' loans.'' Mr Harding went on to point out that in cases where the Crown entert into possession of any property there has been a compromise effected with regard to its liabilities similar to that which appiies with regard to the old Post Office buildings in Hastings. Under this arrangement the Crown, for the present, aecepts the position that tenants aTe occupiers for the purpose of the Rating Act. and will pay rates in proportion of the revenue received for the whole rating year. This arrangements was absolutely a compromise and could be cancelled at any time, but the Crown, with respect to all its departments, has been abiding by the arrangement during the past two years. "While this arrangement appiies Nsatisfactorily where the full rents are always paid," said Mr Harding, " where tho Crown hae resumed possession of properties under its mortgage, and rents are not paid in full, tho councii receives a sum considerably less than a full year 's rates. "There is no doubt tho councii is suffering a .considerable hardship," he added. "More and more properties are' being taken over by the Crown4 and iu very few cases is the rent paid in full. It is, of course, obvious that this Would be the case, as if an occupier were in a good financial position, there would be uo need. for the Crown to take possession. These houBes are receiviug tho full servico that the borough givea to all its citizens. All the amenities provided are received by the' occupiers of the properties, and yet in most cases a portion only of rates are paid." An interesting point was that if an occupier paid ouly three-fifths of this year's rent then the councii would receive only three-fifths of the rate, bnt should tho occupier pay up the arreas in rent the following year the coancil would receive only the full year's rate the second year. "When and Wkile" Occuplef. Regarding the houses tsoon J;o be Duilt by the Housing Department, Mr Harding said that the Government had advised that it will pay the rates On all properties "when and while" occupied. It appears that there will be no rate paid ou the properties recently purcliaeed from the time they wero taken over by the Crown until the liouses, are occupied. "As the words used are 'when and while' it is logical to assume that in the event of a house being occupied foi six months, and the tenant leaving at the end of that period, unless a fresh tenant is immediately found, the councii would receive rates only in proportion " to tlie time the house was occupied," said Mr Harding. "Further, althougb it is not actually staled there io a fairly clea'r inferenco that the same conditions regarding rents will be applied to these housea as is set out in tho first part of this statement, and in the event of tenants not paying full rent, the councii might find itself receiving e proportionate amount of rate ouly. "In any case, it is quite clear thal the eounci] is going to lose a considerable sum of rates this year, on account of the Housing Department 's operations."