Cork County Council collects record rates total

Cork County Council collected a record €120.84m in rates last year, which represented 41% of the local authority’s total income.

However, the local authority could have collected many millions of euro more but for the Government’s failure to rate new businesses as soon as they come on stream.

Lorraine Lynch, the council’s head of finance, said that around 14,200 businesses contributed to the record rates take.

She said this was a sign of the improving economy. In 2013, the council broke the €100m mark for the first time, which was €10m more than it took in rates in 2010.

Ms Lynch said the collection rate for last year was 89.6%, which was up by 1.6 percentage points on 2016.

She said that while the local authority is obliged to maximise its rates take, it was “conscious of the challenging circumstances in which certain businesses find themselves”.

She said rate collection staff continue to engage with all ratepayers and agree payment plans, if appropriate, on a case-by-case basis.

Ms Lynch described the collection performance for last year as “very satisfactory”, adding that a number of significant factors had contributed to this outcome.

“Continued improvement in the overall economic environment, together with improved financial circumstances, resulted in more engagement by many ratepayers in addressing both current and historic liabilities and greater capacity to meet payment commitments,” the council official said in a statement.

Outstanding rates owed on a closed business have to be paid off by any entrepreneur who subsequently opens a new business in the same building.

Ms Lynch told councillors that there had been a noticeable increase in the number of new businesses set up in buildings on which rates were owing.

“The trend of increasing level of property transfers across sectors was sustained and resulted in the discharge of rate liability and resolved, in some cases, previously problematic accounts,” said Ms Lynch.

She said many cases were resolved in advance of court action, but the council was forced to get court judgments in 110 cases last year.

She added that 2017 marked the third year the council had operated a rate relief scheme, whereby a grant was given to all compliant ratepayers once certain criteria were net.

The primary focus of this initiative is to assist small and medium businesses which comprise the majority of ratepayers.

A total of 6,335 ratepayers qualified for the grant last year, at a cost of €400,000, which was credited to rate accounts before the end of that year.

Ms Lynch revealed that €11.17m in outstanding rates were “struck off as irrecoverable.”

A large chunk of that was historic cases which resulted in businesses going into liquidation, receivership etc.

Sinn Féin councillor Melissa Mullane was told by Ms Lynch the council could not charge rates on new businesses until they had been rated by the Government, which can take time, and there is no provision in law to have rates payments backdated to the day the business opened.

Council chief executive Tim Lucey said that, in many cases, it can take up to three years to calculate rate payments.

He said this needs to be addressed because the council is losing a small fortune as a result.


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