Rates waiver demand from hotel chief

Clare County Council should introduce a waiver for hoteliers and guesthouse owners across the county who cannot afford to pay local authority rates.

That’s according to chairman of the Shannon branch of the IHF (Irish Hotels Federation), Michael Vaughan, who is also of the opinion that those in the hospitality industry should only pay what they can afford in the current economic climate and shouldn’t be in fear of being brought before the courts as a consequence.
Mr Vaughan, who owns the Vaughan Lodge Hotel in Lahinch, said that hoteliers are willing to pay a fair and equitable level but simply “can no longer bear the current rates that are imposed in this unprecedented environment when a re-evaluation process that was promised has not been completed”.
“It is a ludicrous situation. Many hotels have been told that, if they do not pay the full amount of rates due, they would be subject to court proceedings. This can only result in the further demise of hotels and the knock-on effect on employees and suppliers to hotels,” he said.
“Many of our suppliers are small, local businesses and now face their businesses being put at risk by local authorities threatening to use their strong legal position to force hotels to pay. That situation would absorb a major share of the cash resources of hotels that is used to run the business by purchasing supplies and services from local operators.”
Mr Vaughan said his members remain committed to meeting their responsibilities to their stakeholders by providing employment for their staff, supporting their suppliers, paying their utility providers and providing excellent service to customers.
He warned that in the current economic environment, members simply “are not generating enough revenue to continue to meet these obligations while paying what are, in our opinion and that of our members, excessive rates levied on the basis of out-of-date and out-of-kilter valuations”.
He added, “This issue is causing a major crisis for the hotel sector and we cannot stand idly by while local authority charges and rates are not reduced to take account of the inability of the hoteliers to pay them.”
He pointed out that since the enactment of The Valuation Act 2001, revisions of rateable valuations in just three of the 88 rateable areas in the country had been carried out.
“The Valuation Office has ignored numerous letters from individual hotels over the past three months, seeking to know when they can expect to have their properties listed for revision of valuation.
“We have appealed to local authorities to introduce a 30% waiver of rates for hotels and guesthouses pending the completion of the countrywide revision of valuations. Neither the local authorities or Minister Gormley are willing to address this issue, which is a big contributor in sending hotels to the wall each week,” he argued.
The IHF is calling on the Minister for the Environment to instruct local authorities to introduce a rates waiver for hoteliers who simply do not have the funds to pay and to agree to accept from hotels an amount of rates that each property can afford to pay, he noted. “The money is simply not there to pay rates at the levels currently levied. While each individual hotel will decide its own payment schedule according to its particular circumstances, we know that in a lot of cases, an inability to afford to pay will mean that the full payment will not be made,” he said.