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31 August 2005
SMOOTHER PROCESS FOR VALUING UTILITIES
Industry guidelines for Valuing Utility Networks for District Valuation Rolls have now been published on the NZUAG website. These are expected to assist a transparent valuation process and lead to a higher level of audit assurance.
Valuer-general, Neill Sullivan, welcomes the publication of the NZUAG National Guidelines: Valuing Utility Networks for District Valuation Rolls, and considers that following the use of these guidelines will lead to greater transparency in the valuation process, and provide a higher level of audit assurance.
“Since Utility Network values first appeared on the District Valuation Roll in 2001, Territorial Authorities, Utility Network Operators and Rating Valuers have had to grapple with issues associated with methodology, data exchange, consistency and confidentiality,” says Sullivan. “These guidelines provide a much clearer understanding of the valuation process and the data exchange protocols necessary to allow for consistent and robust rating valuations, and their use should mitigate some of the past difficulties experienced in producing these valuations and hopefully reduce objections and litigation.”
Rating valuations of utility assets present some unique challenges. They commonly traverse Territorial Authority boundaries, have significant portions of their improvements situated underground (therefore not available for inspection) and are often monopolies within their district.
The guidelines will assist Valuation Service Providers, Local Authorities and Utility Network Owners with the process of valuing utility networks for their inclusion on a District Valuation Roll. They have been designed to mitigate the difficulties that have been experienced in preparing these valuations to date and provide a best practice process for all parties to follow to achieve a timely, cost-effective and appropriate quality result. The document includes a set of guiding principles, and templates for use in valuing the different utility networks.
Sullivan intends to recommend their use, as best practice, within a Rule commentary in the Rating Valuations Rules, subject to their ongoing performance and industry acceptance.
“Development of guidelines of this nature should not just be limited to utility assets; I would support industry led initiatives to enhance the quality and accuracy of rating valuations for all specialised property types. It is my hope that this exercise will be a catalyst for the development of other guidelines as required.”
The Guidelines are available on the NZUAG website, along with the templates for use by any party.