Venture Housing seeks rates exemption for 125 social housing units at Driver, Johnston

A Darwin not-for-profit is locked in a tribunal battle in an attempt to win a precedent-setting ruling that its operations are exempt from council rates, which it says would mean more cheap rentals.

3 Tarakan Ct, Johnston, a social and affordable housing development owned by Venture Housing Company Ltd. Picture: Google Street View

A social and affordable housing provider in the Northern Territory is locked in a tribunal battle as it attempts to win a precedent-setting ruling that its operations are exempt from council rates, which it says would mean more cheap homes.

Venture Housing Company Ltd is seeking to overturn a decision by the City of Palmerston to levy rates upon 125 dwellings across seven unit developments at Johnston and Driver.

Venture, founded in 2011, owns and manages social, affordable and disability homes across Darwin, Palmerston, Katherine and Tennant Creek.

It is a not-for-profit charity registered with the regulator, ACNC, and charges rent at a rate of 25 per cent of the disability support pension, for disability housing, and 74.99 per cent of market value, for social and affordable housing.

According to emails submitted as part of the ongoing case in the Northern Territory Civil and Administrative Tribunal, Venture is seeking to rely on s222(1)(g) of the Local Government Act 2019, which holds that charitable land is exempt from council rates provided it is used for a “non-commercial purpose”.

Venture Housing chief executive Karen Walsh. Picture: (A)manda Parkinson

“Venture’s core purpose is the alleviation of poverty, homelessness, rental stress, and hardship through the provision of safe, secure, culturally appropriate and affordable housing to Territorians in need,” CEO Karen Walsh said in an email to council CEO Luccio Cercarelli.

“The financial liabilities we currently incur through our rates bill seriously limit our capacity for growth.

“With rates exemptions built into our financial models for new housing, we could service more homes and, therefore, be more able to deliver an increased yield.”

In response, council argued that, notwithstanding Venture’s charitable status and the rents being charged at a discounted rate, “the provision of that housing in exchange for rent still constituted the use of the land for a commercial purpose”.

CEO of Palmerston Luccio Cercarelli speaks at the council inauguration in Palmerston Picture: Keri Megelus

The case will return to the tribunal on April 12 for a directions hearing.

Venture’s bid to overturn a rates notice on the basis of s222(1)(g) is the second such case winding its way through the tribunal, with the Kalymnian Brotherhood Darwin Inc seeking to overturn a rates bill in excess of $22,000 on the basis of its charitable status.

Local Government Minister Chansey Paech last year conceded the wording of the provision was causing “confusion,” with different councils interpreting the key phrase “non-commercial purpose” inconsistently.

He proposed broadening the exemption for land held by charities and public benevolent institutions, but backed down on the reform amid opposition by the local government sector, which argued such a move would further deplete their financial sustainability.

While the sector is concerned about organisations such as the Kalymnian Brotherhood winning exemptions, its line in the sand is if the same exemption is found to apply to community housing providers such as Venture.

Last week, the federal House of Representatives Standing Committee on Regional Development, Infrastructure and Transport launched an inquiry, the first in two decades, into the financial stability of local governments Australia-wide.

The committee is chaired by federal Solomon MP Luke Gosling, who said the inquiry was “long overdue”.