Rating Manual section 6 part 3: valuation of all property classes

Section 970: sports grounds

This publication is intended for Valuation Officers. It may contain links to internal resources that are not available through this version.

1. Scope

This Section relates to sports grounds and clubs ranging from first class amateur and semi-professional sports clubs of all types, to those provided for the benefit of employees by hospitals, banks and other commercial or industrial bodies and to groups occupied by voluntary organisations - clubs or recreational charities - for various sporting and recreational activities.

Football and Rugby Football League Stadia (Rating Manual: Section 6 - Part 3 - Section 420), County Cricket (Rating Manual: Section 6 - Part 3 - Section 320), and other specific sports grounds, for which separate guidance is given, are not covered by this section.

2. List Description and Special Category Code

Sports Grounds

List Description - Sports Ground and Premises

Scat Code 261 - this should be used for all sports grounds where there are outdoor grounds or pitches mainly of grass for a variety of sports including occasional indoor courts. Where there are sports specific Scat codes (see below) these should be used. As a Generalist Class the appropriate suffix letter should be G. However, included in this category will be 5 a-side and 7 a-side soccer centres on artificial pitches whether indoor or outdoor. Outdoor centres run by chain operators, or those run by independent operators of a similar nature will be dealt with by the Unit Specialist - in these cases Scat Code 993 and Suffix S should be used.

Bowling Greens (Outdoor)

List Description - Bowling Green and Premises

Scat Code - 030 - This will cover separately assessed bowling greens and bowling clubs with outdoor greens. Indoor bowls clubs come under Scat code 029 and instructions for these will be found at Rating Manual: Section 6 - Part 3 - Section 137. As a Generalist Class the appropriate suffix letter should be G.

Changing Rooms

List Description - Changing Rooms and Premises

Scat Code 410 - This will cover all separately assessed changing rooms. As a Generalist Class the appropriate suffix letter should be G.

Clubhouses

List Description - Clubhouse and Premises

Scat Code 060 - This will cover all separately assessed clubhouses for sports clubs which have no grounds or pitches within the hereditament. It will also include sailing or rowing clubs where the lake or river is not within the hereditament. It will include clubhouses for other non-profit making clubs and hobby clubs such as bridge clubs, amateur boxing clubs and drama clubs. It will not include Masonic lodges, political clubs, working men’s clubs, sports and social clubs (where not attached to an outdoor sports facility) which fall within Clubs and institutes - Scat 061. This Scat Code also does not include scout and cadet huts which come under Scat 293. As a Generalist Class the appropriate suffix letter should be G.

Cricket Grounds and Pitches

List Description - Cricket Ground and Premises

Scat Code 083 - All non-county cricket grounds and pitches including clubhouses and pavilions forming part of the hereditament. As a Generalist Class the appropriate suffix letter should be G. County cricket grounds fall under Scat 082 and are dealt with by the National Specialists Unit with guidance at Rating Manual Section 6 - Part 3 - Section 320.

Football Grounds

List Description - Football Ground and Premises

Scat Code 107 - All football grounds, apart from the grounds of clubs in the five highest leagues, which include clubhouses and other ancillary buildings and structures. As a Generalist Class the appropriate suffix letter should be G. Football stadia (grounds of clubs in the five highest leagues) fall under Scat 109 and are dealt with by the National Specialists Unit - guidance relating to these is at Rating Manual Section 6 - Part 3 - Section 420.

Football Pitches

List Description - Football Pitch and Premises

Scat Code 108 - Single or multiple pitches with little or no ancillary accommodation. Those with more than basic ancillary changing rooms should be assigned to Scat 107. As a Generalist Class the appropriate suffix letter should be G.

Lakes with Water Sports Facilities

List Description: xxxx and Premises. The description should suit the activity,

SCAT code: 145, suffix S/G

This will cover a variety of sports clubs where the sporting activity is water based and the hereditament includes the lake or an exclusive right to use the lake for the pertinent sport in addition to the buildings. This will include sailing, rowing and water ski clubs. Fully commercial occupations, such as dive lakes or lakes where the operator provides water sports as a commercial activity are covered in Rating Manual: Section 6 - Part 3 - Section 1085 : Leisure Attractions.

This is a split class of property with Specialists in each Business Unit valuing the more complex and larger properties.

Pavilions

List Description - Pavilion and Premises

Scat Code 208 - Similar to clubhouses. Scat 060 above, these will tend to be at the smaller end of the range in terms of floor area, are likely to be of lighter construction and have limited facilities. The code and description should not be used where the hereditament includes pitches and playing fields. As a Generalist Class the appropriate suffix letter should be G.

Rifle and Weapon Ranges

List Description - Rifle Range and Premises

Scat Code 237 - Amateur small and full bore rifle clubs with either indoor or outdoor ranges. As a Generalist Class the appropriate suffix letter should be G. This code will not cover shooting grounds, archery grounds and clay pigeon shoots which should be Scat 296 - see Rating Manual Section 6 - Part 3 - Section 385 Farm Diversification.

Rugby League Grounds

List Description - Rugby League Ground and Premises

Scat Code 241 - All rugby league grounds and pitches. As a Generalist Class the appropriate suffix letter should be G. The guidance for the stadia occupied by the leading professional clubs is to be found in Rating Manual: Section 6 - Part 3 - Section 420 and are dealt with by the National Specialists Unit.

Rugby Union Grounds

List Description - Rugby Union Ground and Premises

Scat Code 242 - All rugby union grounds and pitches. As a Generalist Class the appropriate suffix letter should be G. The guidance for the stadia occupied by the leading professional clubs is to be found at Rating Manual: Section 6 - Part 3 - Section 420 and are dealt with by the National Specialists Unit.

Tennis Courts and Clubs

List Description - Tennis Courts and Premises

Scat Code 278 - All tennis courts and clubs. As a Generalist Class the appropriate suffix letter should be G. Where there are indoor tennis courts these will fall under Scat Code 277 - Tennis Centres and will be dealt with by the Unit Specialist - Scat Suffix S.

3. Responsible Teams

Paragraph 2 above covers team responsibility for each of the classes to which this section relates.

4. Co-ordination

The Class Co-ordination Team has overall responsibility for the co-ordination of these classes. You can find contact details here (P:\CEO1\Intranet\Reval 2017\VP & CCTs). The team are responsible for the approach to and accuracy and consistency of valuations. The team will deliver Practice Notes describing the valuation basis for revaluation and provide advice as necessary during the life of the rating lists. Caseworkers have a responsibility to:

  • follow the advice given at all times
  • not depart from the guidance given on appeals or maintenance work, without approval from the co-ordination team
  • seek advice from the co-ordination team before starting any new work

5. Legal Framework

The property may be exempt if it is, or is situated within, a public park. The exemption from rating of parks provided or maintained by a local authority, Para 15 of Schedule 5 to LGFA 1988 (as amended), extends to any part of such park as is available for the free and unrestricted use by members of the public for the purposes of sport or recreation, e.g. cricket, football, bowls, tennis etc. A reasonable charge for the use of equipment and the imposition of restrictions amounting only to proper management would not defeat the exemption.

Where, however, part of a park is reserved for the purpose of sport or recreation and the use thereof, even if only for the duration of the playing season, is granted to a club or person to the exclusion of the public, the part so reserved is not entitled to exemption and falls to be assessed, (See Blake (VO) v Hendon Corporation (No 2) (CA) 1965 RA 67).

Technical Advisers are able to give further detailed advice on this aspect if required.

6. Survey Requirements

Sports Grounds and clubs should be measured to gross internal area (GIA) in accordance with the VOA Code of Measuring Practice for Rating Purposes. A site plan should be provided.

6.1 Pitches

Where possible the entire area of all playing pitches should be measured inclusive of all ancillary touch, spectator and training areas. The number of pitches should also be recorded with a note of those which are full size for senior matches or reduced size for junior levels. If it is only possible to measure the pitches the area measured should include sufficient areas around the pitches for touch judges, dead ball areas etc. A note should also be made of any ancillary amenity areas such as children’s play areas or woodland.

The pitch requirements for the main field sports are set out below:

a. Association Football – For internationals a width of 65-75 metres by length 100-110 metres, for other levels a width of 50 to 100 yards (45.7 – 91.4 metres) by length 100 to 130 yards (91.4 – 118.9 metres) (the pitch must not be square). b. Rugby Union – senior pitches should be not more than 100 metres by not more than 70 metres, in addition the in goal areas at either end should be not more than 22 metres deep and not less than 10 metres deep. c. Rugby League – A maximum of 100 metres by 68 metres plus in goal areas of 6-7 metres. d. Hockey – The standard pitch is 91.4 metres by 55 metres plus a minimum of 2 metres to each side and 3 metres at each end (4 metres and 5 metres respectively are recommended).

6.2 Artificial Playing Surfaces

Each sport’s governing body has its own performance standards for artificial surfaces, although often called “Astroturf” the type of surface and its use may vary considerably. Artificial turf comprises a synthetic fibre carpet as the playing surface laid over, or bonded to, a shock pad or elastic layer laid on a binding, or sealing, layer of a sub-base. The sub-base may be pervious or impervious dependent on hydraulics design. The requirements for different sports vary; for example, for top-level hockey the preferred surface is artificial turf but the latest generation of long-pile or 3G turf, used for football and rugby, is unsuitable as the pile is too long and dense.

All artificial pitches should be measured in their entirety (gross area including non-playing surface) with details being taken of the type of surface, e.g. sand-filled, sand and rubber filled or semi sand-filled water-based carpet, a note of the manufacturer and product name should be made together with any fencing, perimeter barrier and irrigation details. If the pitch is recently constructed the costs of installation should be sought and then passed with referencing details to BAMS. Where the pitch is full size the level to which it may be used for competitive games should be obtained, e.g. practice only, senior matches or international matches.

6.3 Soccer Centres

In addition to the building GIA , age, construction type , playing surface and floodlighting details, it is important to record other facilities provided. These include gym, bar, changing rooms and the area , number and type of surfaced parking. Facilities are sometimes shared with Schools and Colleges and in these cases it is essential to clearly distinguish between facilities that are within the hereditament being valued and those over which there is merely a right of usage.

6.4 Floodlighting

For all pitches, courts and grounds, full details of floodlighting should be recorded including the number of lighting poles, their height and construction, the number of lamps on each pole and level of illumination afforded (in lux). The lighting should be recorded as plant and machinery.

6.5 Cricket Grounds

In addition to an area for the ground details should be taken of the area of the square and the number of pitches. The area of any practice nets and score boxes should be recorded together with details of any all-weather pitches.

6.6 Bowling Greens

The overall area of the bowling green should be measured – a standard flat green (6 rinks) is 38.4 metres square though dimensions may vary slightly. Greens of more or less rinks do occur and it is important that besides the area that the number of rinks is recorded. For Crown greens the area only needs recording. A note should be made of the presence, or not, of irrigation.

6.7 Stands and other spectator accommodation

The area of all stands (and terraces) should be recorded separately together with the number of spectators they hold noting seated and standing numbers separately; the area to be recorded is the footprint of the standing/seating area. It should also be recorded whether the stand (or terrace) is open or roofed. Any accommodation in the undercroft (e.g. groundsman’s stores) should be shown separately.

6.8 Sailing and Water Sport Clubs

The area of any lake (in hectares) whether solely used by the club, or used exclusively by the club for sailing (or the sport involved) and shared with other users, should be recorded. The length of any jetties and pontoons for mooring, slipways or boat storage areas should be noted and shown on any plan. Boathouses should be measured separately whether they are a detached building or the lower level of a clubhouse building (i.e. they should not be included in the GIA of the clubhouse).

6.9 Club-houses

Care should be taken to ensure the club-house does not possess additional value over and above its use as a clubhouse. In recent years many club houses, especially those with the locational advantage of either being alongside the river or some other picturesque position have made their premises available to non-members for corporate events, parties and weddings. This is particularly noticeable with boat houses located adjacent to the Thames. More widely, weekday use by nursery/pre-school crèches may be encountered. The survey should have regard to these additional uses and note the quality of the accommodation offered and the frequency of use (also see 6.12 below).

6.10 Pitch Covers and Inflatable Domes

Details should be taken of all structures for covering pitches (for example, netball or tennis courts). Where recently erected details of the costs of construction should be obtained and passed with referencing details to BAMS.

6.11 Ancillary Accommodation

All dug-outs, score boxes, turnstiles etc. should be referenced to GIA and details recorded of any car parking provision.

6.12 Other Uses

Full details of temporary or regular use of pitches, car parks or buildings for uses not related to sport should be recorded. Such uses will include car boot sales, car parking for park and ride schemes for events elsewhere, nursery schools and weddings and other functions in clubhouses. If the accommodation is substantial and suitable for function use then details of the frequency and scale of this use for such functions should be noted as should the details of any civil ceremony licence. Details of any premises licence for the sale of alcohol and the licensing hours should also be recorded. A note should be made of any local competition for such use. Details of any renting out of the pitches to schools, or other clubs, should be recorded.

7. Survey Capture

Where appropriate rating surveys should be captured on the Rating Support Application (RSA) and in all cases plans and surveys should be stored in the property folder of the Electronic Document Records Management (EDRM) system.

8. Valuation Approach

8.1 Initial Approach

The possible uses of property falling within the description of sports grounds are clearly diverse and by their nature are likely to encompass a wide variety of type and quality. Before deciding on the approach to valuation the question of whom, vacant and to let, would be in the market as possible occupiers needs to be addressed.

The valuer needs to decide whether the property could be occupied as a commercial venture, or not (ignoring the actual occupation), or if the property qualifies for exemption from rating (see paragraph 5 Legal Framework above).

8.2 Could the Property be Occupied as a Commercial Venture?

When considering this question the following are among the factors that should be taken into account:-

a. Size. Professional, semi-professional and commercial organisations are likely to require a certain size of property. The acreage, number of courts or pitches etc and other facilities will need to be sufficient for a commercial type of use. Sports grounds may be limited by their size to occupation by private members’ clubs, or voluntary non-profit making ventures, providing facilities to limited sections of the community. b. Location. This is critically important as the commercial and professional market will need ready access from other company occupations or catchment areas as appropriate. Conversely isolated rural and/or inaccessible grounds will tend to attract small scale occupiers. Location is specifically important when considering club houses e.g. rowing clubs at Putney. c. Planning. There may be planning or other statutory restrictions preventing occupation by any sort of commercial operation or restricting the use to a particular body or activity. d. Quality. For commercial use this is likely to be of high priority. Club houses will be fitted out to a high standard and be large enough to support the sports facilities and ancillary aspects of catering and minor subsidiary activities (e.g. table tennis, billiards etc). Playing areas will need to be of good quality, have adequate drainage and be of sufficient area to satisfy the intended intensity of use. Parking facilities will be of major importance.

These criteria must be appraised realistically having regard to all of the disadvantages of the hereditament as explained at Paragraph 8.5 below.

Poor quality grounds with difficulties of e.g. levels and drainage and generally lacking in facilities will tend to attract non-commercial occupiers only.

Once a decision has been made on the type of hypothetical tenant that would be in the market for a particular sports ground the appropriate method of valuation can be applied.

8.3 Method of Valuation - Rental, Contractors and Receipts and Expenditure

8.3.1 Rentals Method

This may be adopted where it has been decided that the sports ground is of a character that a rental market exists. For many types of property within this class there may be sufficient direct or indirect rental evidence on which to base a valuation (paragraph 8.5(k) below is particularly important in this respect). Consistency of approach in such circumstances is important although it should be appreciated that there may be a number of variables to be taken into account as set out under 8.5 below.

Where direct rental evidence is not available and indirect rental evidence is followed care should be taken to ensure the rents followed pertain to properties that would attract the same type of hypothetical tenant as that under consideration.

Rents passing on commercially occupied sports clubs should not necessarily be analysed and the results applied to amateur sports clubs or charitable premises.

Where rents are paid for sports grounds in a finished state or where in addition to the rent paid the tenant has incurred some relatively minor expenditure on ground preparation and/or the provision of buildings or other facilities, the task of rental analysis will be straight forward and the results can be readily applied to other non-rented properties as appropriate.

In cases where the rent is based on the bare land value and the tenant has borne the cost of ground preparation for its particular use and/or the provision of buildings, or other facilities, the rent will carry less weight for purposes of valuation for rating.

There will be circumstances where, particularly with local authority lettings, rents are paid which reflect the sports ground value of a site without buildings. This may be a useful indication of rental value but care should be taken to ensure that analyses and valuations are on the same basis.

8.3.2. Receipts and Expenditure (R&E) Basis - Revenue Producing Sports Grounds

Where the property is occupied on a commercial profit making basis and there is no direct or comparative rental evidence it may be appropriate to consider an R&E valuation.

As few sports grounds are occupied for commercial profit, it is unlikely that, in the majority of cases, the R&E basis of valuation will be appropriate; minor league cricket and football grounds, tennis courts etc are almost invariably non-commercial in character, as such they are not often occupied in order to produce the highest possible, or indeed any, profit.

However, where demand for a property is very restricted and especially where there is only one possible hypothetical tenant, it will be necessary to have regard to the actual occupier’s ability to pay a rent under the hypothetical tenancy.Reference should be made to Section 8.6 below which provides further guidance.

8.3.3. Contractor’s Basis

The contractor’s basis may provide a guide to assessment where there is no direct rental evidence and comparison with other rented properties is not considered appropriate. Such cases will be any instance where, by reason of situation and/or the facilities provided, reasonable comparison cannot be made with rents paid or the assessments determined for other sports grounds and the method of valuation is not restricted to ability to pay (see section 8.6 below). Care must be taken to ensure that the resultant rateable value to be entered in the rating list fairly represents the rental value of the hereditament. When this method of valuation is adopted special care should be taken to consider the following in order to minimise anomalies:-

a. Appropriate allowances should be made for obsolescence and for any problem caused by the age of a property. Any limitations or restrictions imposed by legislation, e.g. The Safety of Sports Grounds Act 1975, or the Taylor Report following the Hillsborough disaster, should be considered separately. b. Land values adopted should be realistic for the property valued. Many rents of land suitable for sports properties are modest and sound evidence is needed if high site values are to be defended. Planning and Green Belt restrictions also strongly affect land values. c. A realistic approach should be adopted at the ‘stand back and look’ stage. The criteria for the design of many sporting properties has rapidly and radically changed in the last few years particularly with increasing restrictions imposed to improve safety.

8.4 Valuation Considerations - General

It is important to remember that the basis of valuation should be taken to be an amount equal to the rent at which it is estimated the hereditament might reasonably be expected to let from year to year (see Schedule 6(2) Local Government Finance Act 1988) as at the Antecedent Valuation Date. In arriving at this estimate of rental value, it is necessary to consider all available evidence. It is also important to remember that in certain locations the only hypothetical tenant is likely to be the actual occupier (or a very similar occupier stepping into his shoes) and the measure of the ability of that occupier to pay a rent will determine the level of assessment.

8.5 Valuation Factors

In considering the estimated rent at which a property would let in the open market, the following guidance may be of assistance:-

a. Location and Access: Matters such as prominent main road frontage, access to transport links (including public transport), whether in an isolated position, or if access is via an unmade, poorly lit road, etc, are all likely to have an effect on rental value, particularly if security is compromised or the risk of vandalism increased as a result. Smaller and particularly rural grounds may also suffer seasonable restrictions on use due to physical problems such as flooding. b. Accommodation: Is the quality of the buildings inferior or superior to what would normally be expected having regard to location, pitch facilities, etc. Similarly, are the buildings larger than those required by the actual occupier? It is not uncommon for a club to have premises which are either larger or to a higher specification than could be sustained out of its normal year to year activities by virtue of having received an extraordinary capital sum, e.g. from a benefactor or by selling a previous ground for development. In such cases the excess accommodation or specification may be of limited additional value unless it clearly enables the club to attract a higher membership or ancillary function income than other clubs in the vicinity with more modest facilities. c. Playing Facilities (i.e. pitches etc): Are the surfaces well drained, level and of an adequate size and layout? d. Services: In some cases, services (e.g. gas, electricity, main drainage or water) cannot be provided and will impact on the rental value of the property. Smaller and particularly rural sports grounds often suffer from a lack of main services. e.Legal Restrictions: Are there particular planning or other legal restrictions which may affect the use of the facilities within the rating hypothesis? Sports grounds may be subject to planning restrictions relating to use, periods of use (floodlighting use at night) or type of occupier. Restrictions may also arise under the provisions of the Safety of Sports Grounds Act 1975 and the Taylor Report. f. Rights of Way: The value of some grounds may be diminished due to the existence of public rights of way. In some locations, this may require additional security arrangements. g. Competing Demands: Consider how many other similar clubs exist in the locality that are in direct competition for members. The existence of other clubs of a similar nature in the locality may have a detrimental effect on rental values by limiting the potential to increase membership and/or income. h. Tenant’s Improvements: The estimated rental value adjusted to reflect improvements carried out by the tenant may produce an excessive figure when considered against the actual or potential membership of the club. I. Voluntary Labour: It is possible that a club may only be able to afford to carry out improvements if they are undertaken by club members on a voluntary basis, perhaps only paying for the cost of material. Again, in some circumstances, it will be necessary to consider the valuation in conjunction with potential membership of the improved hereditament. j. Grants and Loans: Improvement work may only have been possible with the aid of a grant or loan and any increase in rental value may only be justified by an increase in membership and consequently an increased income to the club. If direct grants are received by the club on a regular basis, they should be investigated because they could have an impact on the rent which the club can afford to pay (see 8.8 (iii) below). Grants or loans received for the purposes of carrying out improvements to the landlord’s hereditament should be disregarded; similarly, income raised to repay that loan should equally be disregarded provided it has been raised in addition to the normal anticipated income of the club. (See also 8.8 below). Where a local authority is the landlord, instead of making a direct grant payment, the rent agreed may be reduced accordingly to reflect a grant element (or subsidy). It is however also important to bear in mind the possibility that the local authority, in agreeing the rent, may have had regard to the actual tenant’s ability to pay. k. Comparing Like with Like: Whilst the property must be valued vacant and to let in its existing physical state (within rebus sic stantibus), it should not be overlooked that there may be different rental markets for different types of recreational users. It is necessary to have regard to uses within the same mode or category of occupation as the actual use. This is particularly important when considering rental evidence. l. Multi-User Facilities: The ability to provide a range of uses throughout the year is likely to enlarge the potential membership and therefore enhance the rental bid. Size, quality and type of facilities available as well as location are all relevant rental factors (see a-d above). Similarly, restriction on use to part of the year could depress the rental bid. m. Non-Playing Members: Properties in prominent locations with good access and good quality accommodation, including licensed bars, may attract a high percentage of non-playing members as well as having the potential to generate additional income and from occasional lettings (weddings etc). The quality of the playing facilities in such circumstances may not be the only consideration in arriving at a reasonable rent for the property.

8.6 Ability to Pay - General

Where it has been decided that the property could only be occupied for non-commercial purposes it may be necessary to consider ability to pay.

This could apply to non-profit making organisations such as tennis, bowls and football and cricket clubs etc, where the size, quality and location of the land and buildings are usually restricted. The rateable value should represent the rent that clubs and organisations of the kind which in fact occupy this type of sports ground could reasonably be expected to pay based on:-

a. number of potential members in catchment area, b. subscriptions at the prevailing level for the type of facility and area (these may be restricted by the Recreational Charities Act if applicable).

Generally where income is generated from the occupation of these grounds the costs of occupation will be barely covered despite voluntary assistance.

In the more rural locations where sports grounds are used for example by village cricket and football clubs, the only hypothetical tenant is likely to be the actual occupier, or another stepping into its shoes, and the measure of the ability of that occupier to pay a rent will determine the level of assessment.

This principle was established by the Court of Appeal in Tomlinson (VO) v Plymouth Argyle Football Co. Ltd. and Plymouth City Council (1960 53 R. & I.T.358) and in such circumstances it is necessary to consider the relative bargaining strengths of the parties.

Further consideration to this principle was undertaken by the Lands Tribunal in the case of an amateur sports club (Tyldesley RUFC v Cole (VO) (1989 LT29 RVR 152)) where the tribunal referred to factors to be considered in determining whether the actual occupier is the only possible tenant.

Whilst accepting that, when this is the case, the question of the club’s ability to pay a rent is relevant, the tribunal nevertheless also considered that regard should be had to the club’s ability to raise additional finance in order to pay the rent the hypothetical landlord would require.

In urban areas a more cautious approach needs to be adopted as there is likely to be evidence of competitive demand among clubs or potential occupiers of a similar nature which must be taken into account. However, the existence of other clubs of a similar nature in the locality may have a detrimental effect on rental values by limiting the potential to increase membership and/or income.

8.7 Lands Tribunal Decisions

Reference should be made to the following decisions of the Lands Tribunal in considering the effect of ability to pay:

  1. Amateur Cricket Clubs

a. Heaton Cricket Club v Westwood (VO), and b. Astley Bridge Cricket Club v Westwood (VO) 52 R&IT 499

  1. Amateur Football Club

Blackman (VO) v Lowe and Tavistock RDC 51 R&IT 74

3.Tennis Club

Ripley Tennis Club v Snell (VO) 44 R&IT 809

4.Rugby Club (Union)

Tyldesley RUFC v Cole (VO) 1989 LT 29 RVR 152

5.Grant

Allen v English Sports Council and Sports Council Trust Co [2009] RA 289 LT

8.8 Factors to be taken into account

I. Demand - In circumstances where there is likely to be competition for the property from more than one potential tenant, the question of the hypothetical tenant’s ability to pay the proposed rent does not normally arise. But where the demand for a particular hereditament is very restricted, and especially where there is only one possible hypothetical tenant, ability to pay should be taken into account. ii. Basis of Valuation - Where it can be demonstrated that demand for a property is limited to one potential occupier, the rent arrived at after considering either rental evidence, contractor’s or R&E basis of valuation, may not represent a level which could be afforded by the actual occupier. It will therefore be necessary to obtain information on the income and expenditure of the occupying club to assist in determining the rent for the hypothetical tenancy which the actual occupier (or another very similar occupier stepping into his shoes) could afford to pay. The questionnaire at Appendix 1 should be used to obtain copies of audited accounts and other background information. iii. Income - It is a club’s ability to pay a rent for the hypothetical tenancy which is important and a view must be taken on whether that rent is reasonable having regard to the club’s income from all sources together with its ability to raise additional funds if necessary. Whilst the Lands Tribunal found in the case of Tyldesley RUFC v Cole (VO) 1989 (see paragraph 8.6 above), that on the facts before it, the tenant could reasonably have increased its income to afford the rent that would be required by the hypothetical landlord, this conclusion may not be applicable in every case. Any limitations which the club may face when attempting to raise income should be considered, e.g. legal restrictions (see 8.5(e) above), competing demands from other premises (such as nearby public houses), locational difficulties, type of accommodation etc. It is the level of income which could reasonably have been anticipated as at the Antecedent Valuation Date which has to be considered. Exceptional payments, e.g. irregular donations, must therefore be considered with caution. The availability of a grant may also affect the level of rent which a club could afford to pay (see 8.5(j) above). In some locations, a total income level per member may produce a comparative guide but this should be treated with caution. iv. Major Repairs and Improvements - It is important to identify income which has been set aside to pay for major repairs or to repay loans made for such purposes so as to ensure that it is not included as part of the club’s overall income for the purposes of calculating the rent when testing ability to pay. Similarly, if the club has raised additional income for major improvements to the hereditament, this should also be disregarded (see also 8.5(j) above). For the club to successfully maintain that a sum of money raised for this purpose in any given year should be excluded from consideration, it will be necessary to identify the source of income, e.g. raised by special fund raising events. Its purpose must have been announced beforehand and the accounts must show the manner in which those funds are being applied or accumulated. Expenditure (including repayment of loans) on major repairs or improvements of the landlord’s hereditament should correspond to the income set aside for that purpose. Neither should be taken into account in assessing the ability to pay a hypothetical rent. v. Expenditure - Careful consideration of all working expenses shown in the accounts is equally as important as the consideration of income. It will be necessary to take a view on whether items of expenditure have been reasonably included at a level which seems realistic having regard to the size and type of club. Payments in respect of rates shown in the accounts may reflect transitional, mandatory or discretionary rate relief. Regard should be had to such possible future changes in this relief year on year as could be anticipated at the Antecedent Valuation Date and the effect that this would have on the hypothetical tenant’s rental bid. vi.Improvements - It should be recognised that improvements to the hereditament may not necessarily increase the hypothetical rent which the actual occupier could afford to pay, e.g. actual or potential income may not always increase as a result of the improvement. vii. Charities - If it is established that demand for the hereditament is restricted to the actual occupier which is a charity occupying under the provisions of the Recreational Charities Act 1958, it will be necessary to have regard to any restrictions on levels of charges which arise from this occupation under the provisions of that Act.

8.9 Community Amateur Sports Clubs (CASC)

8.9.1. Registration

Since 2002 sports clubs have been able to register with the HMRC as a CASC to gain certain financial benefits. In order to qualify as a CASC a club, whether property owning or not, it must be for a sport recognised by the Sports Council, not discriminate in any way in its membership policies, have the core purpose of the promotion of amateur sports and be non-profit making. Thus private members, professional or those clubs where only a small amount of sporting activity is carried out cannot qualify as a CASC. Once a club has registered as a CASC then it always will be a CASC, de-registration carries significant penalties. The registration makes the club’s assets permanently available to the public. The web site cascinfo.co.uk has more detailed information if required. In April 2015 the total registrations were in the region of 6,700 clubs throughout the UK.

8.9.2. CASC Registration Benefits

The main benefits are 80% mandatory relief on business rates, the ability to raise funds on donations under Gift Aid, freedom from Corporation Tax on trading activities if the trading income is under £30,000 and an exemption from taxation on profits from property income if under £20,000.

8.9.3. CASC or Charity

A club may also register as a charity, which gives similar benefits, but has some restrictions compared to CASC status, e.g. charitable clubs cannot have social members (a CASC can as long as they are a minority of the membership) and bars may need to be run by separate non-charitable clubs. Only amateur sports clubs which promote healthy recreation can qualify as a charity; this is likely to exclude sports such as angling, ballooning, billiards and snooker, gliding, motor sports and rifle shooting which can apply for CASC status.

8.9.4. Effect on Rating Assessment

Registration as a CASC or charity in itself will not affect the rating assessment. But the favourable status for rates relief and tax may have an indirect effect. Most clubs will use the additional income for improving facilities and equipment but it should be borne in mind for rented clubs that there are additional funds for the payment of rent compared with a club which is not so registered. Therefore care should be taken when analysing any available rents so that like is compared to like and any adjustments necessary can be made. Similarly in some local authority areas sports clubs may receive discretionary relief up to 100%; this should also be taken into account in analysis but in the knowledge that in times of financial austerity that the relief may be withdrawn which will not be the case for CASCs or clubs which are charities.

8.10 Safety at Sports Grounds

8.10.1. Legislation

Following various major accidents at sports grounds controls were brought in under the provisions of the Safety of Sports Grounds Act, 1975 which placed the control with local authorities. This was amended by the Fire and Safety of Places of Sports Act 1987 which made it the duty of Local Authorities to enforce the Acts. This also extended the controls to all covered stands at sports grounds with a capacity of 500 or more spectators (seated or standing). The Secretary of State has the power to designate sports grounds as requiring a General Safety Certificate or Special Safety Certificate. These currently apply to all Association Football grounds with a spectator capacity of 5,000 or more and other sports grounds with a capacity of 10,000 or more spectators.

8.10.2. Definition of Sports Ground, Stadium and Stand

Under the legislation the definitions are:

a. Sports Ground – Any place where sports or other competitive activities take place in the open air and where accommodation has been provided for spectators consisting of artificial structures or of natural structures artificially modified for the purpose. b. Stadium – A sports ground where a spectator will normally watch the event from a single point, e.g. football, rugby, in contrast to those where spectators are likely to be ambulatory, such as horse racing and golf. c. Stand – A structure providing viewing accommodation for spectators.

8.10.3. Requirements for Designated Sports Grounds

Once the qualified/responsible person for the ground has made an application the local authority must issue a General Safety Certificate which may contain such conditions as the authority considers necessary or expedient to secure reasonable safety such as management requirements, first aid provisions, strength of structural elements etc. Guidance is to be found in the Guide to Safety at Sports Grounds (commonly known as “The Green Guide”) issued by the Department for Culture, Media and Sport. This guidance covers all aspects of safety within sports grounds from management and spectator ingress and egress to barriers, seating and media provision. The authority consults with other interested bodies before issuing the certificate and then makes an annual inspection plus “During Performance” inspections to ensure that the terms and conditions of the certificate are suitable for the use and to monitor compliance. New grounds must gain a certificate before operating.

8.10.4. Requirements for Regulated Stands

Once a local authority has determined whether a covered stand is one which holds 500 or more spectators it is illegal for the stand to be used without an application for a General or Special Safety Certificate being made. New stands accommodating 500 or more may not be used until an application for a General Safety Certificate has been made. The issue and monitoring of certificates is similar to that for designated sports grounds but related to the stand and its escape routes only.

9.Valuation Support

Due to various classes being covered by this section valuations undertaken on a rental basis will be entered on RSA, whereas those on a contractors and receipts and expenditure basis will be entered on the NBS.

Other support available:

  • Survaid
  • Class Co-ordination Team

Practice note 1: 2017 - General sports

1. Market Appraisal

Participation in sporting activity is an integral part of daily life. The popularity of any particular sport ebbs and flows with perceived and publicised benefits, and with wider exposure through local, national or international competition successes. The London Olympics in 2012 was seen as a major opportunity to encourage greater participation, and acted as a catalyst to the launch of numerous initiatives focused on bringing-on young athletes. For each sport there will always be a core group of participants, although in some instances, such as bowls, their ageing profile may impact negatively on the demand for facilities over time.

Sport England measures participation in sport through its Active People Survey (APS) This is based on the percentage of adults (aged 16+) playing for at least 30 minutes of sport at moderate intensity at least once a week. The latest APS results to be published cover the 12 month period from April 2012 to April 2013 and the headlines were as follows:

  • There has been steady acceleration in people playing sport during 2012 (an increase of 750,000 from October 2011 to October 2012) and the bulk of this growth has been retained (although 220,000 below October 2012, the latest result remains 530,000 above October 2011).
  • During the period April 2012 to April 2013, 15.3 million people (35.2%) played sport at least once a week. The latest result represents a 1.4 million increase on 2005/06.
  • Compared with October 2011, the period just before the Olympic year and the start of the new strategy for sport, there are now over 530,000 more people playing sport regularly.

A similar survey undertaken by Sport Wales showed a major jump from 29% of the adult population taking part three or more times a week in 2008 to 39% in 2012 - representing 262,000 more people.

Whether this increased participation is sustained going forwards remains to be seen.

2. Changes From Last Practice Note

There was no Practice Note for the 2010 Revaluation.

3. Ratepayer Discussions

No ratepayer discussions have taken place.

4. Valuation Scheme

The possible uses of property falling within the description of sports grounds are clearly diverse and by their nature are likely to encompass a wide variety of type and quality. Where local rental evidence is available this should be utilised to inform an appropriately structured scheme of valuation. If reference is made to the contractor’s basis or to a receipts driven approach close co-ordination must be undertaken to ensure consistency of valuation outcomes between comparable properties.

There are no changes from the broad principles followed for the 2010 Rating Lists.

Practice note 2: 2017 - Bowling greens

1. Market Appraisal

For the 2010 revaluation it was stated that outdoor bowling clubs had been losing members steadily for a number of years with a general decline in the numbers taking up the sport to replace those who had stopped playing. There is no evidence to suggest this trend has been reversed although with people typically enjoying retirement for longer, older members are often playing for longer at a greater age, it is envisaged the market decline has slowed to equalling no change between revaluations. The general state of many bowling greens, and their associated accommodation continues to suffer from under investment, especially those reliant on local authority funding. Although not the case in all areas it is a discernible trend throughout England and Wales.

2. Changes From Last Practice Note

There are no changes from the principles followed for the 2010 Rating Lists.

3. Ratepayer Discussions

There have been no 2017 List discussions on this class of property.

4. Valuation Scheme

For the 2017 revaluation the recommended approach is to apply a price per green assuming 6 rinks per green for flat bowling greens or a single price per green for crown greens. An addition should be made for any ancillary facilities that will vary with their quality and extent. This approach is to ensure uniformity across the network in terms of data capture and valuation.

The values to be attributed to bowling greens will be derived from analysis of available rental evidence for bowling greens in the locality. Any rents for bowling greens that have more or less than 6 rinks should be adjusted so that the analysis gives a figure for a 6 rink green.

Where applicable public park exemption should be considered see Rating Manual section 6 part 3 Section 970 Para 5 - Legal Framework.

When deciding where within the range a particular club should fall regard should be had to all relevant factors including those set out below:

Positive Factors:
  • Modern with adequate heating and insulated roof;
  • accessible location;
  • adequate private or shared parking;
  • bar/restaurant adequate for members and visitors;
  • adequate changing facilities;
  • relatively high number of playing members per rink;
  • lack of competing bowling clubs within the locality;
  • floodlighting.
Negative Factors:
  • Old building without adequate heating or insulation;
  • poorly located in sparsely populated area;
  • lack of private parking, or no cheap or free public parking close by.
  • lack of bar/restaurant and inadequate viewing facilities;
  • inadequate changing facilities;
  • relatively low number of playing members per rink.

Practice note 3: 2017 - Soccer centres

1. Market Appraisal

At the antecedent valuation date for the 2010 Rating Lists the demand was for pavilions providing additional facilities to changing which typically included a bar and function room. These units typically varied in size between 330 and 480 square metres measured to GIA.

In the post recessionary era (2010 onwards) the use of soccer centres has altered, in that more players tend to turn up, meet in the bar and then depart immediately after the game. The consequent change in construction type to reflect this change (often to units of only 150 - 200 square metres) will mean that the older and larger variants will require some downward valuation adjustment to reflect the fact that they have become larger than the optimum market requirement. This will not be the case everywhere in the country as the effect of the recession has not been evenly distributed throughout England and Wales.

2. Changes from the Last Practice Note

There was no 2010 Practice Note.

3. Ratepayer Discussions

No ratepayer discussions have taken place although it is expected that these will commence during 2015 for the 2017 Rating Lists.

4. Valuation Scheme

A valuation scheme utilising the contractor’s basis was eventually agreed with the industry for the 2010 Rating Lists. It was and is generally accepted that this is the appropriate valuation basis and it will also be adopted for 2017.

The initial Revaluation figures will be prepared by the National Specialists Unit (NSU) based on costings provided by the Buildings and Machinery Specialists (BAMS).

4.1 Valuation Constituents

The valuation comprises three main constituents:

(i) Pavilions

A typical pavilion is constructed of a steel frame and will include changing facilities.

Costs have been prepared for pavilions of various sizes, fitted with additions for outside lighting and drainage appertaining to that pavilion together with adjoining landscaped car park. Interpolation of these costs is required to reflect the differing sizes.

(ii) Pitches

Costs prepared for the modern pitches of various sizes including all fencing and lighting.

(a) Five-a-side pitches

The construction process involves the following:

  • Dig down 250 mm below the top soil which itself is 225-250mm
  • Insert drainage tracks at 4m intervals
  • Pack with hardcore
  • Insert sand to level
  • Place and secure 3G surface
  • Provide lighting
  • Provide fencing
  • Provide landscaping / pathways

(b) Seven-a-side pitches

The costs of these pitches are significantly higher than the 5-a-side and their area is taken as being approximately 40m x 23m giving a total of 920 m2.

(iii) Ground Rents

The valuation will incorporate a ground rent element.

In cases where the facility is shared with a school or college the ground rent is often abated as the rents at these sites are traded off against the daytime use for the benefit of the school.

In several, but not all cases, it may be appropriate to modify or nullify a land rental element in order to compensate for the daytime use as this would appear to be the workings of the market.

4.2 Age and Obsolescence

The 2010 agreed valuation scheme does not reflect age and obsolescence allowances as they are not considered appropriate for this type of property. This will also be the case for 2017.

4.3 Percentage of Turnover to create an RV limit

It was agreed for 2010 that it may be necessary to set an RV limit where it is considered that demand and or turnover was misjudged leading to the creation of a non-viable site.

RV limit as a percentage of turnover is to be applied with caution and only in those cases where it can be proven that demand and or turnover have been misjudged. If the limit as a percentage of turnover were to be set at a level whereby it became anything other than a rare inhibitor of RV, that level would be one that was actually accepted by the market and would act to create an artificial situation.

It has been agreed for 2010 that the relevant percentage is 21% of AVD sustainable turnover and this rare inhibitor is likely to remain for 2017.

Appendix 1: Sports grounds & recreational premises

Date of Issue…………………….. Valuation Office…………………. (please print in black) VALUATION OFFICE AGENCY Information Required for Rating Purposes SPORTS GROUNDS & RECREATIONAL PREMISES Please complete ,sign and return this form to your Valuation Officer within 21 days of receipt (continue overleaf if necessary)
ADDRESS – Name and address of Ground/Club (1) Address for further correspondence (if different from 1)
RENT Is the Ground/Club rented? Yes/No* If yes, please provide the following details: 1) What is the rent paid (ex VAT)? 2) Provide brief lease terms if appropriate including start date and length of lease 3) Is the rent paid for the whole property?? Yes/No* If no, provide details 4) If rented, provide name of Landlord NB If you pay a rent for the property further details may be required. 5) If rented, has the occupier undertaken any improvements?

Yes/No* If yes, provide details 6) If the property is subject to a lease, are the parties involved connected? Yes/No* If yes, provide details 7) When the current rent was agreed or determined, was your club receiving any form of rate relief from your Billing Authority? Yes/No* 8) When the current rent was agreed or determined, was your club registered as a CASC? Yes/No*
USE 1)Do you occupy: Land only*/Land and Buildings*/Buildings only* 2) What is the property used for? 3) Number of teams? 4) Number of pitches/courts/greens etc? 5) Is any part of the premises shared? Yes/No* (if yes, please provide details) 6) Are non members permitted to use the facilities? Yes/No* 7) Please indicate if there are any restrictions in the use/occupation of the property?
MEMBERSHIP Number of Members ACCOUNTS Copies of your club’s audited accounts for the financial years 20 **, 20 **, 20 ** should be enclosed. Would you like these returned to you? Yes/No*
Category 20 ** 20 ** 20 **
Playing
Non-Playing CHARITY/CASC Is your club or organisation a charity or Community Amateur Sports Club? Yes/No* If yes, please provide details overleaf.
Junior
Others
TOTAL
GRANT/LOAN Has your club received a grant? Yes/No* Loan Yes/No* If yes, - who from? - how much? - Purpose? ACCOMMODATION/FACILITIES If you wish to comment on the standard of your accommodation/playing facilities/services/access/ disabled person’s facilities etc*, please do so overleaf.
PLANNING Indicate if your ground/club is subject to any onerous planning restrictions. PUBLIC OPEN SPACE Has any part of your ground been designated for public open space purposes? If so, please supply details.
CONFIDENTIALITY I agree/do not agree* that the Valuation Office Agency can release the contents of this questionnaire and accounts to third parties in the consideration of the rating assessments of other similar properties.
To the best of my knowledge and belief, the particulars on this form are correct and complete.
Name……………………………………… Capacity……………………………… Tel No………………………
Signed……………………………………. Date…………………………………… E mail ………………………

02/11 *delete as appropriate **Valuation Officer to insert relevant year

Section 970: Sports grounds and recreational premises: further guidance

Index to Appendix 2

Contents of Section

Background 1

Evidence 2

Questionnaire 3

Commercial Ventures 4

Valuation Considerations 5

Location and Access 5a

Accommodation 5b

Playing Facilities (ie pitches etc) 5c

Services 5d

Legal Restrictions 5e

Rights of Way 5f

Competing Demands 5g

Tenant’s Improvements 5h

Voluntary Labour 5i

Grants and Loans 5j

Comparing Like with Like 5k

Multi User Facilities 5l

Non-Playing Members 5m

Ability to Pay 5n

Appendix 2: sports grounds and recreational premises - further guidance notes

1. Background

Advice on the valuation of Sports Grounds and Recreational Premises is set out in Rating Manual Section 6 part 3 Section 970. Appendix 1 to Section 970 contains a Memorandum of Guidance which was agreed following discussions with various Central Bodies representing most sports clubs in England and Wales. Having reviewed progress made since the agreement, it is considered that further guidance would be helpful to ensure consistency of approach when valuing this class of property.

2. Evidence

The Memorandum of Guidance looks at the various steps which are necessary when deciding upon the most appropriate method of valuation to be adopted. Following a recent review of available evidence, it is considered that for many types of property within this class there may be sufficient direct or indirect rental evidence on which to base a valuation (paragraph 5(k) below is particularly important in this respect). Consistency of approach in such circumstances is important although it should be appreciated that there may be a number of variables to be taken into account as set out under 5 below.

If no actual rental evidence is available, the estimated rental value of the hereditament may be arrived at by having regard to the contractor’s basis of valuation (see paragraph 5.2 of the initial Memorandum of Guidance). As few sports grounds are occupied for commercial profit, it is unlikely that, in the majority of cases, the profits basis of valuation will be appropriate. However, where demand for a property is very restricted and especially where there is only one possible hypothetical tenant, it will be necessary to have regard to the actual occupier’s ability to pay a rent under the hypothetical tenancy. Reference should be made to paragraph 5(n) below which provides further guidance.

3. Questionnaire

The attached Questionnaire (Appendix A) can be used to obtain additional background information in connection with any available rental evidence as well as accounts to provide assistance in the valuation of this class of property.

For the purpose of completing the Questionnaire it is necessary to bear in mind that it is income and expenditure leading up to the Antecedent Valuation Date (using accounts which would have been available at that time) which should be considered in arriving at the relevant assessment. If the property is rented, accounts available at the commencement date of the rent will be relevant. Care will need to be exercised when considering accounts if structural alterations have been carried out post AVD. See also 5(n)(vi) concerning improvements to the hereditament and the actual occupier’s ability to pay a rent.

4. Commercial Ventures

The criteria to be applied in considering whether the property could be occupied as a commercial venture (see para 4 of the Memorandum of Guidance) should be emphasised. This question must be appraised realistically having regard to all the advantages and disadvantages of the hereditament as explained below.

5. Valuation Considerations

It is important to bear in mind that the basis of valuation should be taken to be an amount equal to the rent at which it is estimated the hereditament might reasonably be expected to let from year to year (see Schedule 6(2) Local Government Finance Act 1988) as at the Antecedent Valuation Date. In arriving at this estimate of rental value, it is necessary to consider all available evidence. It is also important to have regard to the guidance given in paragraph 7.1 of Appendix 1 to RM Section 970, ie in certain locations the only hypothetical tenant is likely to be the actual occupier (or a very similar occupier stepping into his shoes) and the measure of the ability of that occupier to pay a rent will determine the level of assessment.

In considering the estimated rent at which a property would let in the open market, the following guidance may be of assistance:-

a. Location and Access: Matters such as prominent main road frontage, access to transport links (including public transport), whether in an isolated position, or if access is via an unmade, poorly lit road, etc, are all likely to have an effect on rental value, particularly if security is compromised or the risk of vandalism increased as a result.

b. Accommodation: Is the quality of the buildings inferior or superior to what would normally be expected having regard to location, pitch facilities, etc? Similarly, are the buildings larger than those required by the actual occupier. It is not uncommon for a club to have premises which are either larger or to a higher specification than could be sustained out of its normal year to year activities by virtue of having received an extraordinary capital sum, eg from a benefactor or by selling a previous ground for development. In such cases the excess accommodation or specification may be of limited additional value unless it clearly enables the club to attract a higher membership income than other clubs in the vicinity with more modest facilities.

c. Playing Facilities (ie pitches etc): Are the surfaces well drained, level and of an adequate size and layout?

d. Services: In some cases, services (eg gas, electricity, main drainage or water) cannot be provided and will impact on the rental value of the property.

e. Legal Restrictions: Are there particular planning or other legal restrictions which may affect the use of the facilities within the rating hypothesis?

f. Rights of Way: The value of some grounds may be diminished due to the existence of public rights of way. In some locations, this may require additional security arrangements.

g. Competing Demands: Consider how many other similar clubs exist in the locality which are in direct competition for members. The existence of other clubs of a similar nature in the locality may have a detrimental effect on rental values by limiting the potential to increase membership and/or income.

h. Tenant’s Improvements: The estimated rental value adjusted to reflect improvements carried out by the tenant may produce an excessive figure when considered against the actual or potential membership of the club.

i. Voluntary Labour: It is possible that a club may only be able to afford to carry out improvements if they are undertaken by club members on a voluntary basis, perhaps only paying for the cost of material. Again, in some circumstances, it will be necessary to consider the valuation in conjunction with potential membership of the improved hereditament.

j. Grants and Loans: Improvement work may only have been possible with the aid of a grant or loan and any increase in rental value may only be justified by an increase in membership and consequently an increased income to the club. If direct grants are received by the club on a regular basis, they should be investigated because they could have an impact on the rent which the club can afford to pay (see n(iii) below). Grants or loans received for the purposes of carrying out improvements to the landlord’s hereditament should be disregarded; similarly, income raised to repay that loan should equally be disregarded provided it has been raised in addition to the normal anticipated income of the club. (See also n(iv) & (v) below).

k. Where a local authority is the landlord, instead of making a direct grant payment, the rent agreed may be reduced accordingly to reflect a grant element (or subsidy). It is however also important to bear in mind the possibility that the local authority, in agreeing the rent, may have had regard to the actual tenant’s ability to pay.

l. Comparing Like with Like: Whilst the property must be valued vacant and to let in its existing physical state (within rebus sic stantibus), it should not be overlooked that there may be different rental markets for different types of recreational users. It is necessary to have regard to uses within the same mode or category of occupation as the actual use. This is particularly important when considering rental evidence.

m. Multi-User Facilities: The ability to provide a range of uses throughout the year is likely to enlarge the potential membership and therefore enhance the rental bid. Size, quality and type of facilities available as well as location are all relevant rental factors (see a-d above). Similarly, restriction on use to part of the year could depress the rental bid.

n. Non-Playing Members: Properties in prominent locations with good access and good quality accommodation may attract a high percentage of non-playing members as well as having the potential to generate additional income from occasional lettings (weddings etc). The quality of the playing facilities in such circumstances may not be the only consideration in arriving at a reasonable rent for the property.

o. Ability to Pay:

i) Demand

In circumstances where there is likely to be competition for the property from more than one potential tenant, the question of the hypothetical tenant’s ability to pay the proposed rent does not normally arise. But where the demand for a particular hereditament is very restricted, and especially where there is only one possible hypothetical tenant, ability to pay should be taken into account.

ii) Basis of Valuation

Where it can be demonstrated that demand for a property is limited to one potential occupier, the rent arrived at after considering either rental evidence, or a contractor’s or profit’s basis of valuation (see 2 above), may not represent a level which could be afforded by the actual occupier. It will therefore be necessary to obtain information on the income and expenditure of the occupying club to assist in determining the rent for the hypothetical tenancy which the actual occupier (or another very similar occupier stepping into his shoes) could afford to pay.

The questionnaire at Appendix A should be used to obtain copies of audited accounts and other background information.

iii) Income

It is a club’s ability to pay a rent for the hypothetical tenancy which is important and a view must be taken on whether that rent is reasonable having regard to the club’s income from all sources together with its ability to raise additional funds if necessary. Whilst the Lands Tribunal found in the case of Tyldesley RUFC v Cole (VO) 1989 (see para 7.1 of the Memorandum of Guidance), that on the facts before it, the tenant could reasonably have increased its income to afford the rent that would be required by the hypothetical landlord, this conclusion may not be applicable in every case.

Any limitations which the club may face when attempting to raise income should be considered, eg legal restrictions (see 5(e) above), competing demands from other premises (such as nearby public houses), locational difficulties, type of accommodation etc. It is the level of income which could reasonably have been anticipated as at the Antecedent Valuation Date which has to be considered. Exceptional payments, eg irregular donations, must therefore be considered with caution. The availability of a grant may also affect the level of rent which a club could afford to pay (see (j) above). In some locations, a total income level per member may produce a comparative guide but this should be treated with caution.

iv) Major Repairs and Improvements

It is important to identify income which has been set aside to pay for major repairs or to repay loans made for such purposes so as to ensure that it is not included as part of the club’s overall income for the purposes of calculating the rent when testing ability to pay. Similarly, if the club has raised additional income for major improvements to the hereditament, this should also be disregarded (see also 5(j) above). For the club to successfully maintain that a sum of money raised for this purpose in any given year should be excluded from consideration, it will be necessary to identify the source of income, eg raised by special fund raising events. It’s purpose must have been announced beforehand and the accounts must show the manner in which those funds are being applied or accumulated.

Expenditure (including repayment of loans) on major repairs or improvements of the landlord’s hereditament should correspond to the income set aside for that purpose. Neither should be taken into account in assessing the ability to pay a hypothetical rent.

v) Expenditure

Careful consideration of all working expenses shown in the accounts is equally as important as the consideration of income. It will be necessary to take a view on whether items of expenditure have been reasonably included at a level which seems realistic having regard to the size and type of club.

Payments in respect of rates shown in the accounts may reflect transitional or discretionary rate relief. Regard should be had to such possible future changes in this relief year on year as could be anticipated at the Antecedent Valuation Date and the effect that this would have on the hypothetical tenant’s rental bid.

vi) Improvements

It should be recognised that improvements to the hereditament may not necessarily increase the hypothetical rent which the actual occupier could afford to pay, eg actual or potential income may not always increase as a result of the improvement.

vii) Charities

If it is established that demand for the hereditament is restricted to the actual occupier which is a charity occupying under the provisions of the Recreational Charities Act 1958, it will be necessary to have regard to any restrictions on levels of charges which arise from this occupation under the provisions of the Act.

Practice note 1: 2010: Bowling greens

1. Co-ordination Arrangements

This is a group class. Responsibility for ensuring the effective co-ordination lies with the groups. Co-ordination responsibilities are set out in Rating Manual section 6: part 1.

For R2010 special category code 030 should be used and as this is a group class the appropriate suffix letter should be G.

2. State of the Sport

Outdoor bowling clubs in general have been losing members steadily for a number of years and there has been a general decline in the numbers taking up the sport to replace those who have stopped playing. The general state of many bowling greens, and their associated accommodation, have suffered from under investment and have in the main declined. Although not the case in all areas it is a general trend throughout England and Wales.

3. 2005 Rating Lists

From information provided by Groups throughout the network it has been established that for the 2005 rating lists there exists a mixture of data capture and valuation bases for bowling greens. Some Groups have limited information on bowling greens while others have captured and valued bowling greens using one of two methods, either the bowling green as a whole or the individual rinks that make up the bowling green.

4. Revaluation 2010 – Valuation Guidance

For the 2010 revaluation the recommended approach is to apply a price per green assuming 6 rinks per green for flat bowling greens or a single price per green for crown greens. An addition should be made for any ancillary facilities that will vary with their quality and extent. This approach is to ensure uniformity across the network in terms of data capture and valuation.

The values to be attributed to bowling greens will be derived from analysis of available rental evidence for bowling greens in the locality. Any rents for bowling greens that have more or less than 6 rinks should be adjusted so that the analysis gives a figure for a 6 rink green.

When deciding where within the range a particular club should fall regard should be had to all relevant factors including those set out below:

Positive Factors:

Modern with adequate heating and insulated roof; accessible location; adequate private or shared parking; bar/restaurant adequate for members and visitors; adequate changing facilities; relatively high number of playing members per rink; lack of competing bowling clubs within the locality; floodlighting.

Negative Factors:

old building without adequate heating or insulation; poorly located in sparsely populated area; lack of private parking, or no cheap or free public parking close by. lack of bar/restaurant and inadequate viewing facilities; inadequate changing facilities; relatively low number of playing members per rink.

5. IT Support

The development within RSA of analysis and valuation scales specifically for sports grounds and clubs should enable input of factual data to achieve valuations that follow the recommended approach.