Agenda item

The Executive Member for Finance and Governance submitted a report for Executive consideration.

 

The Council’s current policy had been refreshed and now incorporated a number of

proposed amendments as outlined under the heading ‘proposed changes to the

current policy/scheme.’

 

The Local Government Finance Act 1988 provided the Council with mandatory and discretionary powers to award relief from liability for National Non-Domestic Rates (NNDR) against Non-Domestic Properties (Hereditaments).

 

Mandatory relief was awarded at 80% where the ratepayer in occupation was a charity or trustee for a charity or registered Community Amateur Sports Club.

 

Discretionary relief could be awarded to non-profit making bodies and organisations

whose main objectives were philanthropic, religious, concerned with education, social

welfare, science, literature, the fine arts, and to non-profit making clubs, societies or similar bodies that are used mainly for the purposes of recreation.

 

ORDERED that Executive:

 

1.    Approve the proposals as set out in the report approve the updated Discretionary Rates Relief policy.

2.    Approve that delegated authority to approve any future minor revisions/modifications required for clarification or legislative requirements to the policy be provided to the Director of Finance.

3.    That Executive note that the policy brings together three existing schemes, against which discretionary rate relief could be awarded, to be replaced by one policy which provided clarity and consistency for those organisations wishing to apply for the relevant relief.

4.    The proposed key changes to the policy included:

                      i.        Clearly defined criteria, decision making panel and e-form to improve the user experience of the application and governance process.

                    ii.        A cap of 50% for Hardship relief applications in year one, with an option for an enhanced rate of 100% relief in year one if applicants can evidence greater impact to the local economy, as outlined in the policy. In addition, an introduction of tapered reductions in consecutive hardship relief awards up to a maximum of three years subject to appropriate supporting evidence.

                   iii.        For organisations that were not registered as charities or Community Amateur Sports Clubs (CASC), a 20% discretionary relief award will be applied (subject to scheme eligibility). This is a reduction from the existing scheme where non-registered organisations have been eligible for up to 100%.

                   iv.        For Partly Occupied Hereditaments, applicants would need to demonstrate inward investment in order to qualify e.g., businesses relocating into Middlesbrough (as opposed to businesses relocating away from the town)

 

OPTIONS

 

Leaving the existing policies in place: although the current schemes did not provide

sufficient defined criteria, lack any focus for awarding discretionary relief and presented the possibility of a significant increase in applications once Government funding for other reliefs end and as such was not financially viable, hence not recommended.

 

Recent applications had been evaluated against the proposed recommendations. The findings of which would indicate an appropriate level of support, whilst also limiting the financial impact to the Council.

 

REASONS

 

The Policy was a key decision that impacted on two or more wards and as such required Executive approval.

 

Delegated authority to the Director of Finance to approve future minor modifications to the policy maintained service operation levels. As a working policy failure to keep pace with new legislation left the Council at risk and could have resulted in inconsistent practices.

 

The proposals which were contained within the policy distinguished between registered and non-registered organisations. Charitable and sporting organisations that were registered with the Charities Commission and HMRC respectively, often presented with a robust operational structure which improved their status and long-term viability. In addition, registered organisations could apply for mandatory rates relief that reduced liability by 80%.

 

Focusing support on registered organisations ensured that applications were awarded fairly and appropriately to those organisations that were sustainable and could continue to provide a long-term Service which was of value to the town.

 

Organisations that were not registered charities/non-profit making organisations/ sporting organisations etc would be signposted by Resident and Business Support to register with the respective governing bodies to improve their status and maximise funding opportunities for their organisation.

 

For organisations that choose not to register, whist relief could be provided subject to qualification, this was to be capped.

 

To support organisations through the application process, the proposed policy brought together the three sections under which discretionary rate relief could be awarded. Previously, these sat independently and so had the potential to lack clarity for the applicant about the relief available.

 

The policy now provided better value in the form of appropriate targeted support to those organisations that could demonstrate a positive contribution to the town's economy. The policy also limited any potential loss of income to the Council, given Central Government was currently providing temporary support for enhanced discretionary rates relief which they had provided on a single year basis.

 

The proposed policy clarified the qualifying criteria, which also included proposed amendments to some of the criteria and improved the timeliness of the decision-making process. All of which had due regard to the interests of the town’s council taxpayers and economy, the sustainability of the applicant organisation, and the impact on the Council’s income and its overall financial position.

 

The policy met the aims of the Mayor’s priorities - ‘A Successful and Ambitious Town’ and ‘Delivering Best Value’ as set out in the Council Plan 2024 – 2027.

 

The proposed amends to the policy had been informed where relevant by input from the Council’s Regeneration Team.