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The guidance given in this practice note specifically relates to “Natural Burial Sites” occupied by non-municipal operators.
However, Local Authorities are under no statutory obligation to provide such sites. This guidance will therefore also apply to municipal, stand-alone sites which are remote from traditional cemeteries.
For the avoidance of doubt, it will NOT apply to municipal “natural burial sites” contiguous to or which form part of a traditional municipal cemetery. These will typically constitute one assessment, and the contractor’s method should also be used to value the natural burial element. These areas will tend to be reasonably recent additions to traditional cemeteries; it is probable that there will be actual development costs available which could be indexed to AVD. It will also be appropriate to consider how much of the land is required for future years based on current numbers of burials and then value accordingly (See Practice Note 1 for guidance on the valuation of traditional Cemeteries & Burial Grounds).
This guidance is not appropriate for burial grounds with substantial buildings used for services or other gatherings, nor where there is a permanent staff presence. In such cases advice should be sought from CEO Rating.
Due to the relatively low capital cost of agricultural land and/or woodland in relation to the legal costs, planning, infrastructure and start up cost of such sites it is unlikely that any recognised rental market will exist for this Class.
CEO is not currently aware of any such rental evidence for this class. However, if any rents come to the notice of VOs, they should be notified immediately to CEO (Rating).
Due to the evolving nature of this sector, in-depth discussions have been held with a representative from the Natural Death Centre, an organisation representing many of the Natural Burial Sites in England and Wales.
It is important that from the outset that occupiers of such hereditaments, though diverse, have some certainty as to their level of assessment. Smaller sites in the in the initial setting up stages are working to tight margins, as can be seen from the break even estimates below and therefore the effect of rates can sometimes be a deciding factor in the continuing viability of the operation. It must also be remembered that once an interment has taken place, the occupier will have an ongoing liability to the family of the deceased for a period of many years.
These discussions have produced fruitful contact with a wide selection of sites, many of which have provided information regarding receipts and expenditure. From this cross section, it has been possible to establish typical income and expenditure streams and it is on these figures that the valuation method below is based.
A Proforma has been compiled (Appendix A) in consultation with the NDC, to establish the information required to undertake the valuation. The NDC has been asked to circulate these forms to its members. Any full accounts details which are received by local offices, either as a result of these questionnaires or by any other means, should be copied to CEO-Rating for information.
A bespoke spreadsheet has been designed to facilitate the application of the Valuation Method outlined below, which is included as Appendix B with accompanying notes on completion.
a) Income
The first stage is to establish the actual income received. This will predominantly come from two sources: -
i) Income from Actual Burials
The actual number of burials as at AVD will need to be considered, along with figures supplied for previous years (if available) to establish the reasonable number of burials that could have been expected as at AVD.
This Number of Burial should then be multiplied by the cost of each burial as at AVD to arrive at the total income from this source. For sites operating on low burial charges, (i.e. beneath the minimum level), the figure of £500 per burial is to be taken as the minimum level to be applied.
ii) Income from Pre-Need Sales
The term “pre-needs” is used to describe the practice of selling burial rights in advance of future need. The figures for Pre-Need Sales as at AVD will need to be considered, along with the figures supplied previous years (if available) to establish the reasonable number of Pre-Need Sales that could have been expected as at AVD.
This Number of Pre-Need Sales should then be multiplied by half the cost of each burial as at AVD to arrive at the total income from this source. The reason for taking only half of this income is to reflect uncertainty due to the possibility of refund. Many sites will offer either a full or substantial refund if requested by the purchaser.
Other Income.
From information received to date, it appears that the income from the sale of trees, plaques and seats tends to be at little more than cost, with a small additional amount to cover administration, so these will not normally be significant items when establishing income over expenditure.
b) Expenditure.
Total Expenditure should then be calculated under these heads:
i) Fixed Costs – This is an absolute cost for each site of £1,350
ii) Pathways – The figure of £50/burial should only be applied to the number of actual burials, excluding pre-need.
iii) Administration – The figure of £24/burial should be applied to both actual and pre need burials.
iv) Telephone – The figure of £14/burial should be applied to both actual and pre need burials.
v) Trees/Shrubs – The figure of £36/burial should only be applied to the number of actual burials, excluding pre-need.
vi) Maintenance Labour – This has been calculated at £674/ha for smaller sites and £462/ha for those sites over 3ha, there being a sliding scale at the margin. Subject to the guidance below on the site area to be adopted.
vii) Provision for Fencing - The figure of £90/ha should be applied to reflect the cost of providing fencing. Subject to the guidance below on the site area to be adopted.
viii) Allowance for future commitments – This is to be taken as 20% of total income for sites which are ten years old or less. Dropping to 15% of total income for sites of 11 years or more.
Actual costs of grave digging are ignored as they are normally charged separately; they can therefore be ignored in terms of both income and expenditure
Site Area.
Care should be taken when considering the site area to adopt, it is not unusual for a site to be many times the size of what may actually be required for the present burial ground. Some of this land if totally undeveloped may be better considered as expansion land for the future. (Gaining the necessary planning and environmental consents can be a complicated, lengthy and costly process, so some operators may, if they own adjoining land, choose to apply for permission on a larger area than they would otherwise). It would be inappropriate to apply the full maintenance rate to such areas, where they are clearly not yet required or contribute to the running of the current burial ground.
For example, a farmer owns three fields each of an acre, fenced separately and for which he has obtained the necessary consents for natural burial. If he has only carried out say 20 interments, side by side in the first field which may be capable of say 600 burials, then realistically the maintenance costs should only apply to that area, unless it is manifestly clear that the other areas have all been physically incorporated into the main site i.e. with boundaries, planting etc. such that a greater degree of regular maintenance, than would usually be expected for an ordinary field, needs to carried out. Where maintenance of such areas is of a lower standard than the main site and actual costs are not readily discernible, a judgement should be made as to the proportion of the full maintenance cost to be applied.
This is to avoid the anomaly of two sites which both undertake a similar numbers of interments, where the smaller site of say 1 acre has a significant rateable value. Whilst the other larger site, is valued at a nominal sum, because it has additional un-improved land to which a full notional maintenance costs has been applied. Clearly, the correct approach for the second site is to take the full maintenance costs against the developed area (which can usually be identified on site by boundaries, fencing, planting etc) and additional maintenance cost (if any) of the un-improved land, thereby giving an RV which is comparable to the first site.
c) Divisible Balance.
The remaining amount after all expenditure (outlined above) will be the divisible balance and this should be divided by 2.4 (equal share between landlord and tenant less rates liability) to establish the appropriate amount available for rent and thereby establish the corresponding rateable value.
From actual known receipts and expenditure, it is expected that there will be sites operating beneath a certain number of burials per annum without significant income from other sources, which should be treated as de minimis.
For example, a 1Ha site, operating at the minimum price level with no other significant income would be treated as de minimis if it carried out less than 8 interments per annum.
These sites should however, still be shown in the rating list but at a nominal figure of say £1 RV. This is so that the level of income and expenditure can continue to be monitored through successive revaluations.
However, such de minimis provisions are not expected to apply where one or more buildings have been constructed on site.